A former Caterpillar executive says in a lawsuit he was punished for calling out the company about sketchy tax practices — demoted and threatened with termination if he didn’t take the allegedly lesser job. The man accuses the company of using accounting tricks to avoid paying $2 billion in federal income tax.
Bloomberg reports the man, who still works for Caterpillar, is hoping for a court order that lands him his old job and gives him stock options he says were denied him.
At issue is the company’s “Swiss structure,” which lightens the company’s U.S. tax burden by shifting profits to its Switzerland-based operations. Bloomberg reports the suit says:
“In order to shift profit to Switzerland, Caterpillar pretended to shift the management and control of a large portion of its most profitable business segment to Switzerland, but in reality the management and control of this business remains in the United States.”
A Caterpillar spokesman said the man’s reassignment was not a demotion and that the company “complies with applicable tax laws and regulations.”
Caterpillar Accused of Demoting Executive Discovering $2 Billion Tax Dodge [Bloomberg]