Renaissance Technologies $6 billion tax evasion case was believed to have been possible through the use of structured financial products purchased from Barclays and Deutsche Bank, according to a pair of senators Monday. Sens. Carl Levin, the chairman of the Senate Permanent Subcommittee on Investigations and John McCain, the ranking Republican of the same faction reportedly released the 93-page report on the alleged Renaissance Technologies $6 billion tax evasion.

According to Market Watch, the report on the Renaissance Technologies $6 billion tax evasion details how so-called basket options were used before a hearing with company executives. The report was released Tuesday.

Bloomberg reports that the investors of the hedge fund of Renaissance Technologies LLC was probably able to avoid more than $6 billion in U.S. income taxes over 14 years through transactions with Barclays Plc (BARC) and Deutsche Bank AG (DBK), as told by a Senate committee.

The report with Renaissance Technologies $6 billion tax evasion reportedly covers sales of options to more than a dozen hedge funds but did not lose its focus on what they called two of the largest users of the product, Renaissance and George Weiss Associates. The report said that the banks and hedge funds also apparently avoided federal leverage limits through the transactions.

Through contracts with the banks, the hedge fund used to create the "fiction" that it was not the owner of thousands of stocks traded each day, Senator Carl Levin said. Levin is a Michigan Democrat and chairman of the Permanent Subcommittee on Investigations. According to Bloomberg, the tactic aimed to transform profits from rapid trading into long-term capital gains taxed at a lower rate.

Levin told reporters yesterday in Washington of the alleged Renaissance Technologies $6 billion tax evasion, 'It meant enormous profit for both the banks and the hedge funds. Ordinary Americans had to shoulder a tax burden of billions of dollars, a burden that was shrugged off by those hedge funds.'

On Monday, briefing reporters cited that the subcommittee is not alleging illegal behaviour by the banks or hedge funds. Levin said, 'We never reach those kinds of judgments.' He added that the subcommittee simply presents facts and just leaves the determination if laws have been broken to regulators and prosecutors.

However, both Levin and McCain reiterated that with the use of basket options, such as with Renaissance Technologies $6 billion tax evasion, taxpayers have been treated unfairly and the Treasury had been deprived.

Levin said, 'These banks and hedge funds used dubious structured financial products in a giant game of 'let's pretend,' costing the Treasury billions and bypassing safeguards that protect the economy from excessive bank lending for stock speculation.'

Meanwhile, the panel is currently urging the Internal Revenue Service to collect taxes from fund investors at a higher rate which Americans pay on wages and salaries, reports Bloomberg. According to the panel, Congress should remove legal obstacles to audits of hedge funds and other large partnerships, whose returns are reportedly rarely questioned.

Renaissance executives are reportedly set to testify at a hearing today in Washington about the transactions and the alleged Renaissance Technologies $6 billion tax evasion. They will be doing the same as representatives of Barclays and Deutsche Bank. According to Bloomberg, Renaissance was founded by billionaire mathematician James Simons.

McCain said at the hearing, 'Americans are tired of seeing Wall Street firms playing by a set of rules other than those applying to ordinary citizens.'

In response to accusations with the Renaissance Technologies $6 billion tax evasion, the company released a statement today and said that it 'is comfortable that its tax treatment of the options is correct under current law.' Renaissance added that 'it expects to prevail in a dispute with the IRS over the matter.' Their decision to utilize a product known as basket options wasn't driven by the tax benefits, they said.

According to reports, Renaissance, which was based in East Setauket, New York, compiled one of the best investing history records through the use of advanced mathematics and computer algorithms in identifying mispriced securities.

The fund manager has reportedly created fortunes for its top executives, which also happened to be amongst Medallion's biggest investors. According to the Bloomberg Billionaires Index, Simons's fortune is estimated to be at $15.5 billion. He is a prominent political donor, who contributed more than $9 million to Democratic causes in the 2012 election cycle.

In the meantime, McCain reiterated that hedge funds 'cannot be allowed to have an unfair tax advantage over ordinary citizens.'

In the case of Renaissance Technologies $6 billion tax evasion, according to the subcommittee, was done when the company used basket options to treat short-term gains as long-term gains. This allowed the hedge fund to avoid more than $6 billion in taxes between 2000 and 2013. However, the subcommittee was not able to provide an estimate for George Weiss Associates.

Spokesman Jonathan Gasthalter for Renaissance Technologies said in an emailed statement that the fund believes it followed tax laws and did not commit the Renaissance Technologies $6 billion tax evasion.

He said, 'We believe that the tax treatment for the option transactions being reviewing by the [subcommittee] is appropriate under current law. These options provide Renaissance with substantial business benefits regardless of their duration.'

Gasthalter added that Renaissance has only fuly cooperated with an Internal Revenue Service review of the transactions.

Renaissance Technologies $6 billion tax evasion will be defended by co-CEO Peter Brown of Renaissance Technologies as well, reports Market Watch. Brown will reportedly be testifying at Tuesday's hearing, as well as Gerard LaRocca, chief administrative officer for the Americas at Barclays and Barry Bausano, president of Deutsche Bank Securities Inc.