[JURIST] Federal prosecutors in Manhattan filed the largest criminal tax case ever Monday against 19 defendants formerly employed by accounting firm KPMG [corporate website]. The revised indictment [PDF text] replaces an indictment [JURIST report] filed against 9 defendants in August and accuses 17 former KPMG executives, a lawyer, and an investment advisor, with attempting to defraud the IRS through fraudulent tax shelters, filing fraudulent individual income tax returns containing the tax shelter losses, and concealing the shelters from the IRS. Prosecutors believe that the shelters helped wealthy individuals avoid paying $2.5 billion in taxes. The indictment does not name any KPMG clients who purchased the shelters. In August, KPMG itself settled with federal prosecutors [JURIST report], avoiding an indictment by agreeing to pay a $456 million fee, accepting independent monitoring of its activities, and acknowledging their wrongdoing [KPMG press release, PDF]. The New York Times has more.