A husband and wife have filed a case against Ernst & Young, blaming the firm for the loss of $40 million in a shelter deemed abusive by the Internal Revenue Service.The Florida couple, Rocco and Mary Abessinio, are seeking class-action status for the lawsuit, which was filed in federal court in Manhattan in April.
In the filing, the Abessinios said that they paid more than $40 million in increased tax liabilities for 2001 and 2002 after Ernst & Young's Personal Investment Company, or PICO, strategy was challenged by the IRS. PICOs were among what IRS Commissioner Mark Everson termed "flaky tax products" last October, when the agency encouraged thousands of taxpayers to settle pending audit cases.
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