Former Arnold & Porter Partner Gets Probation in Tax Shelter Fraud Case

Attorney avoids prison sentence, due to cooperation with probe and prosecution of illegal shelters
Former Arnold & Porter tax partner Peter Cinquegrani was sentenced Tuesday to three years probation for marketing fraudulent tax shelters for Ernst & Young clients. Cinquegrani was emotional as he addressed the court. "I think my desire to be a big shot, feel that I was part of the in crowd in the tax community, overrode my conscience," he said.

Mark Hamblett

New York Law Journal

2010-03-31 12:00:00 AM

Peter Cinquegrani, a former Arnold & Porter tax partner, was sentenced Tuesday to three years probation for marketing fraudulent tax shelters. Cinquegrani, who pleaded guilty in 2008 to conspiracy to commit tax fraud, aiding and abetting tax evasion, and aiding in the submission of false and fraudulent documents to the Internal Revenue Service, was given probation because of his substantial cooperation with the probe and prosecution of illegal tax shelters for high-income clients of Ernst & Young.

Southern District of New York Judge Sidney Stein said Tuesday he saw no purpose to sending Cinquegrani to prison, although the judge considered the impact a prison sentence would have in terms of general deterrence to other lawyers tempted to cross the line. In the end, Stein said, Cinquegrani worked with prosecutors from the beginning, helping them decipher complicated tax transactions.

Accompanied by defense attorney Paul C. Rauser of Washington, D.C.-based Aegis Law Group, Cinquegrani, 50, was emotional as he addressed the court. "When I was going to law school, you think about appearing in federal court. This is not what I had in mind," he said. "I think my desire to be a big shot, feel that I was part of the in crowd in the tax community, overrode my conscience." Assistant U.S. Attorneys Richard C. Tarlowe and Mark D. Lanpher represented the government.