A federal court in Miami has permanently barred Osvaldo J. Diaz of Coral Gables, Florida, from preparing federal tax returns for others, the Justice Department announced today. The permanent injunction order was signed by Judge Jose E. Martinez of the U.S. District Court for the Southern District of Florida.
The government’s complaint alleged that Diaz prepared tax returns that fabricated deductions and credits in an attempt to understate his customers’ tax liabilities or inflate his customers’ refunds. Specifically, the government alleged that Diaz fabricated business and personal expenses and inflated real estate losses for his customers. According to the complaint, the Internal Revenue Service examined 250 returns prepared by Diaz and found that 93 percent resulted in additional taxes being owed. The government alleged that the tax loss from the returns prepared by Diaz could be tens of millions of dollars.
The IRS lists return-preparer fraud as one of the Dirty Dozen Tax Scams for 2013. In the past decade, the Justice Department's Tax Division has obtained injunctions against hundreds of tax fraud promoters and unscrupulous tax preparers. Information about these cases is available on the Justice Department website.