Investors sue Bank One (JPMorgan Chase & Co). over tax shelters

[papau]

NEW YORK (Reuters) - Three investors have sued Bank One Corp., which is now part of JPMorgan Chase & Co. (JPM), accusing it of marketing a tax shelter that let rich investors improperly hide millions of dollars.


http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=8930782&src=rss/businessNews




Bart stood for "basis adjusted remainder trust," and Homer stood for "hedge option monetization of economic remainder."
Ultimately, the banks and Jenkens worked together on only one Bart, but about 40 Homers.

According to the complaint, the plaintiffs bought Homers in November 2001, believing them to offer a legitimate way to save taxes. The Wilsons were told that Homer took advantage of a tax code "loophole" to reduce tax liability.

The complaint, however, said Homer and Bart were similar to another shelter, Cobra, that the Internal Revenue Service had banned in 2000. The agency considers tax shelters that exist to produce losses and lack economic substance to be illegal.

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