The Financial Times reports:

A former BDO Seidman accountant pleaded guilty on Wednesday to charges that he participated in a scheme to sell abusive tax shelters that helped affluent clients avoid paying hundreds of millions of dollars in US taxes.

The accountant, Charles Bee, a vice chairman and board member at BDO Seidman from 2000 to 2003, head the firm’s “Tax Solutions Group”, which marketed a series of tax shelters that generated paper losses for affluent clients.

Mr Bee pleaded guilty in federal court to charges of conspiracy and perjury. He also confessed to one count of tax evasion for using his own firm’s shelters to reduce the taxes he paid on approximately $20m in salary and bonuses earned through the success of the BDO programme.

According to court documents, Mr Bee and several colleagues, including BDO’s former chief executive, developed two tax shelter schemes -- involving the short sale of US Treasuries and a “short options strategy” -- which were virtually certain to generate paper losses, but not financial losses, for clients.

It also notes:

The former chief executive, Denis Field, has not been charged. Under his leadership, from 2000 to 2003, the firm’s tax-related revenues soared.

Prosecutors also said that the tax shelters created paper losses of more than $1bn for clients of the investment management firm, causing the evasion of more than $200m in taxes.

Sorry: that’s not bad apple behaviour. That’s a firm with a failed culture. If it started with the CEO you can’t say anything else.

I’d love to think the profession has rooted this stuff out. But I look round the tax haven / secrecy jurisdiction world daily and see it has not.

The issues remain, and they will so long as the profession thinks tax avoidance is not only acceptable but desirable. It’s not. It’s as desirable as an MP’s expense claim that complies with the rules but is clearly abusive of the public purse: indeed, the two things are exactly the same.

Tax compliance is the only acceptable way forward where tax compliance is defined as seeking to pay the right amount of tax (but no more) in the right place at the right time where right means that the economic substance of the transactions undertaken coincides with the place and form in which they are reported for taxation purposes.

This is the way in which the profession can restore trust. And it’s not me who doubts it’s lost it. As Dennis Howlett noted yesterday, it’s McKinsey’s who said:

Most recognize the perception that some companies in certain sectors (particularly financial services) have violated their social contract with consumers, shareholders, regulators, and taxpayers.

Oh yes, so true.

But where are the voices in the profession standing up and saying this? Apart from Dennis, me, Francine and Prem Sikka?

What has to happen before these people realise corruption is not a viable business model — and tax avoidance is corrupt in the sense that it is an abuse of power and that corruption always, always comes out?