Credit Suisse (Casualty Loss)
Investors at four high-end luxury resorts have filed a class action lawsuit against Credit Suisse and Cushman & Wakefield, contending they conspired to inflate the value of property so that they could take them over.
In the Complaint, the Plaintiff’s lawyers contend that Credit Suisse and Cushman & Wakefield conspired by setting up a Cayman Islands branch to circumvent a federal law on real estate appraisals. The Plaintiff alleges they inflated the value of resorts and made millions of dollars in fees on loans against the property. Credit Suisse knew the resorts would most likely default under the weight of inflated values which would allow the bank to take ownership of each on the behalf of the Creditor.
For taxpayers who have been defrauded, they may be eligible for a tax loss deduction for their fraud damages if the fraud is considered theft under their state’s law (see Gerstell v. Commissioner 46 TC 161 (1966)). The tax loss deduction may be carried back for prior years for tax refund, or carried forward for future years for tax free income up to the amount of the tax loss.
See article, Credit Suisse is Accused of Defrauding Investors in 4 Resorts
The New York Times, January 5, 2010.
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