The Shuster Project

Tobacco Industry Fraud & False Claims Issues

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From: Robert X. Shuster – 177 Andrew Avenue – Naugatuck – CT – 06770 – Email: Rshus177@aol.com

This letter was sent to the 42 Attorney's General that have electronic communications available. (Click here)

Date 3/3/99

Re: Federal/State/Municipal Tobacco Industry Corporate Fraud

Dear Honorable Attorneys General,

With over 17 years employment within the tobacco industry, I have been witness to an incredible array of fraudulent tobacco company policies and procedures which have, going back several decades, resulted in the loss to the Federal, State and Municipal governments of tens of Billions of dollars in revenues.

Early last year, aided by a distinguished attorney with over 29 years of experience, several as an IRS prosecuting attorney, I brought to the attention of the IRS just one of these never before revealed fraudulent corporate practices which resulted in the loss to the Federal Government, not including your States, of multiple tens of Millions of dollars in Income Tax revenues.

After several phone and letter contacts with the IRS, resulting in a face to face meeting with a Special Agent of the IRS, it was clearly revealed that the IRS was being given information which they previously had never known to exist.

This face to face meeting resulted in a series of 6 Qui Tam actions, encouraged by the IRS, which represented this fraudulent Income Tax practice of the remaining 5 domestic cigarette manufacturers and one that was bought out a few years ago by Brown & Williamson.

Although long delayed, I looked forward to assisting the IRS in understanding the labyrinth of forms and fraudulent procedures which will easily reveal where the misreported income was hidden by the tobacco companies.

Unfortunately, my attorney’s concern about the IRS being unwilling to allocate proper manpower and resources to our information became a reality.

This resulted in the dispatch by them of a simple form letter informing us that, now, our information and commitment to assisting them recover upwards of 50+ Million dollars in FICA, Medicare, Social Security and employment taxes, among others, in a turnabout by the IRS, would not be acted upon by them.

Of course, I cannot allow these issues to become hidden, once again, or be ignored by the IRS merely because they choose to bury their heads in the sand, particularly since they clearly acknowledged that they had no prior knowledge of the corporate fraud that I DID reveal to them of the tobacco companies.

As part of a public awareness program I have developed to make the American people knowledgeable of the Federal, State and Municipal fraud employed by the tobacco companies for many decades, it has always been my goal and objective to work within the system of justice to assist the Federal and State governments first and to the best of my ability.

That said, before I implement a more public presentation of that fraud, I wanted to make sure that any State that wished to recover either their share of any State Income taxes lost through fraudulent tobacco company practices, including their Medicare, employment and any other applicable State taxes, can, within a reasonable time period.

Although there are numerous fraudulent practices and procedures used by the tobacco companies which result in the loss to the States of tens of Billions of dollars in revenues, my experience with the IRS dictates that I take them one at a time, at first.

Unfortunately, the Federal government has once again chosen to drop the ball on both obtaining this never before revealed information and recovering the lost revenues.

For the sake of order and organization, my attorney will respond to all inquiries sent to me at my E-mail address of Rshus177@aol.com.

We will be more than happy to assist either a class action by the States or individual actions by individual States in order that you have the information you need to recover your lost revenues from the tobacco companies.

Those States with existing Qui Tam statutes are encouraged to respond immediately, as those statutes give you immediate and broad powers to investigate False Claims and other fraudulent tobacco company policies and procedures which have resulted in hundreds of millions of dollars in losses to your individual States.

As with your previous actions against the tobacco companies, the information I am willing to reveal, in it’s entirety, can result in the recovery of a conservative estimate of 35-50 Billion dollars in lost Federal, State and Municipal revenues.

Also, as this information has never before been revealed publicly, new regulation and both new and reinforced legislation will result in the generation of new streams of revenues for your States which can assist the funding of countless State projects without tapping into existing State revenues.

As I intend to initiate the public presentation of my information by the end of May 1999, I would ask that you contact me immediately via my E-mail address of Rshus177@aol.com.

If, through specific and demonstrated ways, it is shown that any number of States need time beyond May of this year to enact actions for recovery of these lost funds, I will be willing to extend the public presentation timetable of my project.

Thank you, in advance, for your prompt consideration in this matter.

Sincerely,

Robert X. Shuster

A note to The Honorable Mike Moore.

As you have been at the forefront of States action against the tobacco companies, you may have noticed that the States of Arkansas, Hawaii, Nebraska, New Hampshire, New Mexico South Carolina, Tennessee and Washington D.C. and Puerto Rico were not included in the list of States being sent this information.

As they have no published fax number or internet address that I am aware of, I have to assume that you have devised a way to communicate with them via the internet or fax.

Please feel free to send them this information and suggest to them that they contact me at my E-mail address of Rshus177@aol.com with the means to communicate with them via internet or fax.

With Gratitude,

Bob Shuster

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