A lot is at stake in a Wayne tax accountant’s bold claims of tax avoidance at Vanguard — not just for Chester County but for the entire mutual fund industry.
The mere idea of the scheme is likely to thrust competitors into a frenzy of debate over the merits of the accusations, according to Independent Adviser for Vanguard Investors newsletter publisher Daniel P. Wiener, as reported by Philly.com.
“From a broader perspective, this assault on Vanguard’s ‘at cost’ operating principle could, if successfully challenged, have seismic implications for the fund industry and possibly put competitors on a more level playing field with Vanguard as far as costs are concerned,” he said in the article.
Former Vanguard accountant David Danon alleges his employer sheltered hundreds of millions of dollars by providing services to its funds at cost rather than market value and didn’t pay taxes on a contingency reserve. A Vanguard spokesman denied any wrongdoing.
Read more about Wiener’s assessment of the situation on Philly.com here, the Wall Street Journal here and Chesco Business Today’s initial report on the lawsuit here.
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Top photo courtesy of CCEDC
