Good afternoon. I am joined today by IRS Commissioner Mark Everson and United States’ Attorney for the Southern District of New York David Kelley. Thank you both for being here.

I know that each of you – and countless dedicated employees from the IRS, the Southern District of New York, and the Tax Division here at the Justice Department – have worked tirelessly on this important case and I appreciate your – and their – efforts.

Since it was created more than three years ago, the President’s Corporate Fraud Task Force has had a number of important successes. The daily work of federal investigators and prosecutors is reaping dividends for America’s employees, executives, and investors.

Today, we are able to announce another product of this hard work. KPMG – one of the largest accounting firms in the country – has admitted to criminal wrongdoing in the largest-ever tax shelter fraud.

Over a six-year period, KPMG and allegedly nine defendants deliberately perpetrated a scheme that generated more than 11 billion dollars of phony tax losses. That scheme enabled wealthy KPMG clients to evade billions of dollars in taxes they owed on income and capital gains.

While the firm was earning at least 115 million dollars in fees by defrauding government tax collectors, ordinary citizens were stuck with the bill.

KPMG has been charged with conspiracy to defraud the IRS. However, the Justice Department has agreed to defer prosecution on that charge, provided that KPMG meets a series of stringent conditions.

KPMG will pay fines, restitution, and penalties that add up to 456 million dollars, cooperate fully with the Government’s investigation, and – perhaps most important – they will establish a compliance and ethics program to help prevent such wrongdoing in the future.

In addition, nine individuals who participated in this scheme by allegedly creating fraudulent tax shelters, preparing false tax returns, and hiding their actions from the IRS have been indicted. They will be prosecuted to the fullest extent of the law.

With these actions, we continue to send the message to those who might cross the line into corporate fraud: financial crimes do not pay.

Every case is different. And the appropriate law enforcement response will be different depending on a variety of factors. Today’s announcement reflects the reality that the conviction of an organization can affect innocent workers and others associated with the organization, and can even have an impact on the national economy.  The Department's longstanding principles take account of such collateral consequences of prosecuting an organization.

Today’s deferred prosecution agreement recognizes that justice must serve offenders and victims, as well as our economy and the general public.

The Justice Department has a responsibility to protect the interests of every taxpayer and every citizen. We take seriously our duty to the public – and to the companies working hard to turn an honest profit – to safeguard the competitive environment and protect the justice system.

The President established the Corporate Fraud Task Force to coordinate the balanced – and consistent – enforcement of our laws regarding securities fraud, accounting fraud, and other related financial crimes. The goal was to provide justice for American investors and restore confidence in the American marketplace.

With these actions, we are protecting the efforts of honest businesses as well as deterring future crimes… before investors lose their money, before hard-working employees lose their jobs, and before people have lost confidence in the business community or our competitive marketplace.

That’s why the Corporate Fraud Task Force focuses on enforcement as well as innovative resolutions that value compliance, cooperation, and victim compensation. We have zero tolerance for corporate fraud, but we also recognize the importance of avoiding collateral consequences whenever possible.

This case is an example of the Task Force’s work where we were able to detect and punish the kind of corruption found at KPMG, and in doing so, help to restore a level of faith and confidence in the honest and transparent business practices that have made ours the greatest economy in the world.

I’d like to thank everyone at the Justice Department – especially the Tax Division, the U.S. Attorney’s Office in the Southern District of New York, the Internal Revenue Service and others who helped bring about a resolution to this case that is consistent with those goals.

Thank you. I would now like to recognize the Commissioner of the Internal Revenue Service, Mark Everson, and then we will be available to answer questions.