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Georgia Tax Return Preparer Sentenced for Causing $15.7 Billion in Fraudulent Refunds
WASHINGTON – With tax season in full swing, the public is being warned to avoid dishonest tax-return preparers who fleece their customers and illegally drain the U.S. Treasury.
According to the Tax Division, U.S. taxpayers filed approximately 150 million returns in 2014. The Treasury Inspector General for Tax Administration reported that the Internal Revenue Service (IRS) identified more than 2.1 million of those returns that claimed fraudulent refunds totaling more than $15.7 billion.
Acting Assistant Attorney General Caroline D. Ciraolo of the Tax Division warned the public to be wary of anyone who guarantees a refund or who claims to sell a sure-fire way to reduce your taxes.
Noting that every taxpayer is ultimately responsible for the contents of his or her own return, Ciraolo stated, ‘Every year, thousands of federal income tax returns are prepared by people who care much more about making a quick buck than about preparing accurate returns.’
‘Most tax return preparers are honest. But some preparers who charge clients a percentage of their tax refund intentionally prepare false returns to increase their clients’ refund, and thus their own fees,’ Ciraolo said.
U.S. taxpayers might think that they’re getting a good deal on their taxes, or that as long as someone else prepares the return, they’re not responsible. They’re wrong. Taxpayers who have their return prepared incorrectly are required to pay the tax they owe, or pay back the refund they weren’t entitled to get. These clients might also owe interest and penalties, which can be substantial.
Fortunately, there are red flags that taxpayers can look for and avoid when choosing a return preparer.
In United States v. Elton L. Barnes, No. 2:14-cv-05621 (C.D. Cal.), the court barred a return preparer who caused other people’s tax returns to be deposited to bank accounts in his name.
Never sign a blank return or a blank form, or sign a return or a form without reading it first. By law, a return preparer must provide a client with a completed copy of the return no later than the time the customer is asked to sign the return.
In United States v. Syed N. Ahmed et al., No. 2:15-cv-11461 (E.D. Mich.), the United States alleged that the defendants’ Liberty Tax Service franchises asked customers to sign blank forms that stated that the customers had non-existent businesses, which were then used to maximize the customer’s refund.
Defendant: Elton L. Barnes
Criminal Charges: Causing others’ tax refunds to be deposited to bank accounts in his name
City and State: California
Exact Date: No specific date mentioned
Sentence or Outcome: The court barred Elton L. Barnes from preparing tax returns or providing tax advice for compensation
Dollar Amounts: Over $15.7 billion in fraudulent refunds
Key Facts
- State: Georgia
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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