Hoyt Fiasco: $103M Heist + Kevin Brown's Criminal Cover-up
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     Why did the IRS lead prosecuting attorney in the Hoyt case quit in disgust?

Hoyt Fiasco:
The Pooley Letter

Why would a former top IRS manager write a letter that shows the IRS to be so unreasonable? Read on...

In Memoriam:

This request is dedicated to the memory of my client, Marge Rice, a widow and loving grandmother, who strove to overcome the burden of tax debt unexpectantly imposed by old Hoyt  investments. She became tired and passed on to her heavenly reward  last November.

And to the memory of an idealistic young man, Bruce de Lotty, whose devoted sister related that he chose to let go of life in 1992 shortly after receiving an unexpected $350,000 tax bill from IRS and being filled with despair over the fate of the many investors he had brought into the cattle partnerships during his association with Jay Hoyt.

-- Richard L. Pooley

Pooley's letter | Who is Pooley | Pooley's resume

Pooley's scalding revelation
of IRS corruption and criminal activity

P 0 Box 15676, Sacramental, CA 9SO52

January 22,1998

The Honorable William Roth
Chairman, Finance Committee
United States Senate SH-104
Washington, DC 20510

Dear Senator,

This is an urgent request for a joint Congressional and General Accounting Office (GAO) investigation into certain illegal and inappropriate actions of the Internal Revenue Service (IRS) In Its seventeen year conduct of the audit project they have alternately called "The Hoyt Tax Shelter" or "The Walter J Hoyt Project" - hereinafter referred to as 'The Hoyt Project.

There is also an immediate concern with IRS' selective and acknowledged (by IRS) punitive enforcement actions directed against 4,500 hapless investors located throughout the country.

The details of the key allegations are provided later in this report but are summarized as follows:

1. IRS was in a long term constructive conspiracy with the "abusive" (IRS’term) tax shelter promoter, Jay Hoyt wherein IRS' action or lack thereof, aided and abetted Hoyt's recruitment of investors.

2. IRS supplied approximately $126 million In Treasury funds for the promoter’s scheme.

3. IRS consciously failed to use the Injunction authority granted by Congress in the 1982 TEFRA laws.

4. IRS ignored its own 1933 Procedure guidelines for stopping tax shelter schemes.

5. IRS failure to Issue prescribe pre-filing notices to Investors from 1983 to 1992 denied the Investors the opportunity to react to the partnership audits and to protect themselves from further tax liability.

6. IRS allowed Hoyt to keep his IRS enrolled agent status, despite gross practice violations.

7. IRS actions preserved Hoyt’s exclusive TMP status as a means to achieve its yield objectives.

8. IRS appears to have cut a deal with Hoyt in 1986 to drop its criminal investigations of him in exchange for his concession of issues in tax court that was fatal to the Interest of the investor.

9. IRS officials unexpectedly overturned two negotiated agreements In 1986 and 1992 wherein Hoyt would cease selling, close the partnerships, liquidate assets, pay preparer penalties and would have offered investors out-of-pocket settlements.

10. There is credible evidence that IRS gave favorable settlement treatment to a small class of investors but has covered up this fact to prevent other Investors from seeking a similar consistent settlement treatment as provided In IRC 6224.

11. IRS his been derelict in its public duty responsibilities to inform the public and protect the revenue.

12. Collective Abuse - An IRS group manager has promised to "punish" the investors;  a revenue officer described the collection enforcement action of that group as a "search & destroy" mission

13. Collection Abuse - IRS has illegally seized one annuity; is threatening to seize others; and has levied on the annuity income of many investors In contradiction of IRS Manual guidelines and often after the investors have been discharged from their residual tax liabilities in a bankruptcy action.

14. Collection Abuse- in 1994 IRS took selective levy actions against a certain group of investors to collect "Hoyt caused" late filing partnership penalties.  The investors targeted were ones who had not yet taken the IRS settlement offer.  IRS acknowledges that their purpose was to coerce these people into taking the IRS settlement offer- This is a possible constitutional "Due Process" violation.

Who is Pooley?

Mr. Pooley was a top level IRS manager, supervising a Division staff, 5 Branch Chiefs, 30 Group and Section line managers, 150+ Revenue Officers, and 100+ technicians, analysts, and administrative and clerical employees.

Initially, as Division Chief, he was responsible for accomplishing the program objectives for the Collection and Taxpayer Service functions. Later, the Taxpayer Service functions became a separate Division. In the Collection function, his duties entailed the implementation of and adherence to IRS policies, practices, and procedures as they relate to the technical areas of liens, levies, seizures, sales, summons, assessments, offers in compromise, writes, subrogation, delinquent return investigations, fraud referrals, audit referrals, jeopardy and termination assessments, financial statement analysis and evaluations, trust fund recovery penalties, appeals, bankruptcy stays, transferee assessments, fraudulent transfers, bonds, collateral agreements, civil suits, installment agreements, statute extensions, compliance checks, employment tax  examinations, daily reports, operational reviews, performance evaluations, merit pay objectives, and workload management.

Mr. Pooley received six Distinguished Performance awards, an EEO award, the Criminal Investigation Division's Appreciation award, the Assistant Commissioner's Significant Contribution award, and public service commendations from the United Way. Mr. Pooley retired from the IRS on August 1, 1989.

Richard L. Pooley's Resume


Tax Consultant

  • Twenty six years with the United States Internal Revenue Service (IRS)--with thirteen of those years as an IRS Division Chief and Program Manager.
  • Member of International Monetary Fund's (IMF) Panel of Fiscal and Tax Experts--with consulting missions to the Republic of Sri Lanka (1992), Namibia (1996), and Azerbaijan (1997).
  • IRS-authorized Continuing Professional Education (CPE) seminar sponsor for tax professionals. Seminars conducted through Richard Pooley & Associates, Brown Bag Seminars and professional tax associations.
  • National tax liability consultant an representative; enrolled agent authorized to practice before the Internal Revenue Service. Business established 1990.
  • Court-recognized expert witness on IRS tax liability matters; on a panel of expert witnesses/consultants for the US Federal Defender's (DOJ) office in Northern California.

Other business activities

California licensed private investigator (PI) since 1989.



1990 - 1997 Continuing Professional Education (CPE) courses.
1963 - 1989 Numerous IRS management and tax-related courses.
1964 - 1968 Postgraduate courses at East Texas University, West Texas University, and Southern Methodist University.
1957 - 1963 BS in Business from Little Rock University, minor in accounting.

Last updated: Friday, October 09, 2020

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