Washington (Jan. 29, 2004) -- As part of the Justice Department's crackdown on illegal tax schemes, a federal court in Fort Worth, Texas, this week permanently barred an Oklahoma City woman and her company from promoting an illegal tax scam that targets African-American business owners.
The permanent injunction order, signed by Judge John H. McBryde of the U.S. District Court for the Northern District of Texas, also bars Sherri L. Harris and her company from preparing federal income tax returns for others. The order was entered in a civil suit filed by the Justice Department last month.
Harris, Ebony Scott, of Arlington, Texas, and Kelvin Bailey, of Madison, Tenn. -- all doing business as S-N-K Enterprise Inc. (also known as S&K Enterprise) -- had charged customers several hundred dollars to prepare and submit applications for federal minority-owned business grants.
According to the Justice Department, the defendants never filed the grant applications but instead, without the customers’ knowledge, filed amended federal income tax returns for the customers seeking refunds ranging from approximately $44,000 to $93,000 per return, based on claiming bogus tax credits. The Internal Revenue Service prevented over $2.7 million in losses to the U.S. Treasury by identifying and disallowing these fraudulent refund claims.
Judge McBryde also ordered Harris and the company to notify customers of the court’s order and to provide the Justice Department with the names, addresses and phone numbers of customers and company salespersons. The suit against Bailey and Scott is still pending.
-- WebCPA staff
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