The Department of Justice Filed a Civil Lawsuit to Stop Gilberto Cortes and His Business, Mundo Hispano Services, From Preparing Federal Tax Returns

Source- http://www.justice.gov/tax/2014/txdv14183.htm

WASHINGTON – The Department of Justice filed a civil lawsuit today in the federal court in Nashville, Tenn., to stop Gilberto Cortes and his business, Mundo Hispano Services, from preparing federal tax returns. According to the complaint, Cortes and his business have prepared more than 7,000 tax returns since 2010.

The complaint filed with the U.S. District Court in the Middle District of Tennessee alleges that Cortes understates his customers' federal tax liabilities or generates larger than warranted refunds by improperly claiming the additional child tax credit on their income tax returns. According to the complaint, thousands of Cortes' customers have improperly claimed the additional child tax credit. As a result, his customers have received, on average. over $2,300 in improper benefits per return. In total, the complaint alleges that Cortes' activities over the last three years have potentially cost the U.S. Treasury $12.8 million or more in lost income tax revenue.

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The Department of Justice Filed a Civil Lawsuit to enjoin Carmen J. Martinez and her Business, CJM Bookkeeping and Taxes LLC, From Preparing Federal Tax Return

Source- http://www.justice.gov/tax/2014/txdv14133.htm

WASHINGTON – The Department of Justice filed a civil lawsuit in the federal court in Delaware today to enjoin Carmen J. Martinez and her business, CJM Bookkeeping and Taxes LLC, from preparing federal tax returns. According to the complaint, Martinez and her business, which is located in Wilmington, Del., have prepared more than 7,800 tax returns since 2010.

The complaint, filed with the U.S. District Court for the District of Delaware, alleges that Martinez understates her customers' federal tax liabilities by preparing returns that contain false deductions, including unqualified dependents, the Child Tax Credit, the Additional Child Tax Credit and tax rate benefits derived from improper filing status as Head of Household or Married Filing Jointly. As a result, Martinez's customers improperly received tax refunds of $5,000 each year on average. The complaint alleges that Martinez's activities between 2010 and 2013 have cost the U.S. Treasury as much as $25 million in lost income tax revenue.

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Bill Melot was Sentenced to Serve 14 years in Prison Today to be Followed by Three Years of Supervised Release for Tax Evasion

Source- http://www.justice.gov/tax/2014/txdv14132.htm

WASHINGTON – Bill Melot, a farmer from Hobbs, N.M., was sentenced to serve 14 years in prison today to be followed by three years of supervised release for tax evasion, program fraud and other crimes, the Justice Department, Internal Revenue Service (IRS) and U.S. Department of Agriculture's (USDA) Office of Inspector General announced. Melot was also ordered to pay $18,469,998 in restitution to the IRS and $226,526 to the USDA.

Melot was previously convicted of tax evasion, failure to file tax returns, making false statements to the USDA and impeding the IRS following a four-day jury trial in Albuquerque, N.M. According to court documents and evidence presented at trial and at sentencing, Melot has not filed a personal income tax return since 1986, and owes the IRS more than $25 million in federal taxes and more than $7 million in taxes to the state of Texas. In addition, Melot has improperly collected more than $225,000 in federal farm subsidies from the USDA by furnishing false information to the agency. Specifically, Melot provided the USDA with a false Social Security number (SSN) and a fictitious employer identification number (EIN) to collect federal farm aid.

According to court documents and evidence presented at trial, Melot took numerous steps to conceal his ownership of 250 acres in Lea County, N.M., including notarizing forged deeds and titling the property in the name of nominees. The evidence also showed that Melot used false SSNs and fictitious EINs to hide his assets from the IRS. Additionally, Melot maintained a bank account with Nordfinanz Zurich, a Swiss financial institution, which he set up in Nassau, Bahamas, in 1992, and failed to report the account to the U.S. Treasury Department as required by law.

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