FOR IMMEDIATE RELEASE|
THURSDAY, JANUARY 6, 2005
TDD (202) 514-1888
FEDERAL COURT BARS NORTH CAROLINA MAN’S TAX FRAUD SCAMS
Fraudulent Scheme Helps Customers Set Up Sham “Churches” To Evade Income Tax
WASHINGTON, D.C. - The Justice Department announced today that a federal court has barred Frank D. Perkinson, of Garner, North Carolina, from selling two tax fraud schemes. The permanent injunction order, entered by Judge Malcolm J. Howard of the U.S. District Court for the Eastern District of North Carolina, requires Perkinson to stop selling "corporation sole" and "claim of right" tax programs.
According to court filings, Perkinson falsely advised prospective customers that they could exempt themselves from income tax by transferring their income and assets to a so-called "corporation sole" and then falsely claiming it was a church. In the "claim of right" program, the government alleged that Perkinson falsely told customers that wages paid as compensation for their labor were not subject to income tax. The government alleged that Perkinson charged customers $2,295 for the corporation sole scam, and $1,095 for the first year of the claim of right package, with additional amounts charged for later years.
“The Justice Department and the Internal Revenue Service are committed to stopping tax fraud schemes,” said Eileen J. O’Connor, Assistant Attorney General for the Justice Department’s Tax Division. “People who sell or use tax fraud schemes can expect serious trouble, including criminal charges where appropriate.”
The court’s order also requires Perkinson to give the Justice Department a list identifying his customers and to mail a copy of the injunction order to all customers. The court also ordered Perkinson to remove materials about the banned promotions from his websites and to post a copy of the injunction order on those sites for one year.
Court papers showed that Perkinson worked with Joseph O. Saladino, through an organization called the Freedom & Privacy Committee, in promoting the fraudulent schemes. Separate Justice Department suits against Saladino, of Palmdale, California, and other alleged promoters have been filed in courts around the country.
This case was handled by Martin M. Shoemaker, a trial attorney in the Justice Department's Tax Division. More information about this case and the related cases is available at http://www.usdoj.gov/tax/txdv04192.htm, http://www.usdoj.gov/tax/txdv04220.htm, http://www.usdoj.gov/tax/txdv04709.htm, http://www.usdoj.gov/tax/txdv04700.htm, and http://www.usdoj.gov/tax/txdv04639.htm.
The Justice Department has sought and obtained injunctions against a number of tax-scam promoters. Information about these cases is available on the Justice Department website at http://www.usdoj.gov/tax/taxpress2004.htm. The corporation sole and claim of right programs are included in the Internal Revenue Service’s list of the “Dirty Dozen” tax scams, available at http://www.irs.gov/newsroom/article/0,,id=120803,00.html. Information about the Justice Department’s Tax Division can be found at http://www/usdoj.gov/tax.