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A Salt Lake securities broker/dealer has been awarded judgment of $309,904 by a federal court jury, which found that its brokers are independent contractors rather than employees, as was asserted by the Internal Revenue Service.
The money represents a refund of federal withholding and FICA taxes, federal unemployment taxes, penalties and interest paid by Covey & Co. relative to its stockbrokers in 1986-88.
"This has been an issue because there are a lot of controls exerted on stockbrokers by the SEC and the NASD," said local attorney Stephen G. Crockett, who acted as Covey's trial lawyer.
"The issue was: do those controls preclude a stockbroker from being an independent contractor? This case demonstrates that it does not. Of course, it depends on the particular brokerage house, but...