Frank Zerjav Jr and Sr, Tax Fraud, Missouri 2010

A federal judge in St. Louis has shut down two tax preparation businesses and banned their owners from certain conduct in a move to combat tax fraud, according to a federal court order.

The order, entered by Judge Richard E. Webber of the U.S. District Court for the Eastern District of Missouri, requires The Advisory Group Inc. to be shut down by April 1, 2010, and permanently bars Zerjav & Co. from specified conduct.

The defendants, Frank ‘Tiger’ Zerjav Jr. and his father Frank Zerjav Sr., were barred from certain conduct, including claiming business deductions for non-deductible personal expenses, improperly deducting restaurant meals, child care expenses and education expenses, and changing customers’ accounting records without informing them of the changes.

The court also imposed a five-year monitoring period during which a neutral monitor, who must be a licensed CPA or attorney, will annually at the defendants’ expense inspect and review a sample of tax returns prepared by defendants to ensure that the court’s order has not been violated.

The Justice Department’s Tax Division praised the efforts of trial attorneys Michael Pahl, Michael Roessner, Martin Shoemaker and Natalie Sexsmith, as well as Mark Stone and James Graczyk of the Internal Revenue Service’s Small Business/Self Employed Division, who conducted the investigation.

Since 2001, the Justice Department’s Tax Division has obtained more than 460 injunctions against tax-fraud promoters and tax preparers.

The defendants’ actions are a clear violation of tax laws and a threat to the integrity of the tax system. The shutdown of their businesses and the banning of their owners from certain conduct is a step in the right direction to protect taxpayers and ensure compliance with tax laws.

Mandatory Facts: Defendant: Frank Zerjav Jr. and Frank Zerjav Sr., Exact Criminal Charges: Claiming business deductions for non-deductible personal expenses, improperly deducting restaurant meals, child care expenses and education expenses, changing customers’ accounting records without informing them of the changes, City and State: St. Louis, Missouri, Exact Date: Not specified, Sentence or Outcome: 3-year ban for Frank Zerjav Jr. and permanent ban for Frank Zerjav Sr., and shutdown of The Advisory Group Inc. by April 1, 2010.

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