U.S. Representative Transfer Accounting Firm to Wife

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United States Representative Steven Palazzo is transferring his Biloxi, Mississippi accounting firm to his wife. The reason for this is so ownership of the firm can satisfy House ethics rules. Even though he is doing this to follow rules, the move is coming under scrutiny and it is being questioned as to whether it is legal under Mississippi laws. The move is also being questioned because of the vanishing of a political action committee that has gone missing from the firm’s website.

The accounting firm, Palazzo & Co., is causing a problem because the state law requires “certified public accounting firms such as Palazzo’s can only be owned by CPAs. The congressman is one, but his wife, Lisa Palazzo, is not.”

  

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“After HOH began asking about the CPA situation this week, the firm’s website was changed. Lisa Palazzo is now identified as the ‘firm administrator,’ and the site removed references to Steven Palazzo as the sole proprietor,” reported Roll Call, a publication that reports about issues on Capitol Hill.

A spokesman for Palazzo claims that the transfer date of ownership became effective on May 26, 2011. The chief of staff for Palazzo, Jamie Miller, had the following to say about the transaction:

“Since elected to Congress, Congressman Palazzo has not been engaged in the services provided by the business and has not received any compensation from the company. The firm’s services have been provided by professionals, and the structure, ownership and services of the firm were changed in order to comply with the conflicting requirements of the house ethics rules and Mississippi law.”

The firm specializes in tax accounting services for expatriates living abroad and has offered a PAC to promote expatriate tax breaks. Once reporters questioned the PAC, which was on the website, it was mysteriously taken down.

Miller released a statement to the area media that said the following:

“The PAC referenced in the Roll Call story is a dormant and inactive organization that did not raise any contributions until the Roll Call reporter contributed $25 dollars. The FEC rules require an organization to register and report as a PAC after it has raised $1,000 or more in contributions or spent more than $1,000. As of the date of the article, the organization did not satisfy either threshold.”

Palazzo reported, in his finance disclosure field with the U.S. House, that he earned $199,912.90 in the year 2010 as a result of the accounting firm. Palazzo also said he values the firm between $500,000 and $1 million. Palazzo also cited a spouse salary from Palazzo & Co. PLLC but filed it as N/A. Even though N/A means not applicable, no one could confirm if Lisa Palazzo drew a salary from the firm.