COURT STOPS FRAUDULENT TAX-RETURN PREPARER

Norfolk Preparer Used Sham Trusts to Claim Improper Deductions

WASHINGTON, D.C. - The Justice Department announced today that a federal court has permanently barred Ronald M. Green of Norfolk, Virginia, from preparing federal income tax returns for others. Judge Henry C. Morgan, Jr., of the U.S. District Court for the Eastern District of Virginia in Norfolk, also prohibited Green from representing customers before the IRS and from attempting to enforce contracts that purport to restrict his customers from discussing Green’s tax preparation services.

In its permanent injunction order, the court found that Green, who does business as “Peoples Rights Trusted Tax Services” and “Economic Empowerment for All People,” has prepared fraudulent tax returns for customers from the Tidewater area of Virginia and from Maryland, Pennsylvania, New York, South Carolina, Alabama, Texas, Arizona, and California. According to the court, Green improperly reported his customers’ income on trust tax returns and claimed improper tax deductions to falsely reduce or eliminate customers’ taxable income, and to claim fraudulent tax refunds. The court concluded that the trusts either did not exist or were shams. The court also found that Green obstructed IRS audits of his customers and, on at least one occasion, attempted to intimidate an IRS employee.

“The Justice Department and the IRS are working across the country to eliminate fraudulent return preparation,” said Eileen J. O’Connor, Assistant Attorney General for the Justice Department’s Tax Division. She thanked Anne Graham and Gregory Van Hoey, the Tax Division trial attorneys who handled the case, and the agents of the IRS’s Small Business/Self-Employed Division who investigated it.

More information about this case is available at http://www.usdoj.gov/tax/txdv04374.htm and http://www.usdoj.gov/tax/txdv04466.htm. Tax scams involving the misuse of trusts top the IRS’s list of the “Dirty Dozen” tax frauds for 2004, which is available at http://www.irs.gov/newsroom/article/0,,id=120803,00.html. Information about the Tax Division’s efforts in other injunction cases is available at http://www.usdoj.gov/tax/taxpress2004.htm.