A federal court has permanently barred Pete Escalante Gutierrez and Jeanette Gutierrez from preparing federal tax returns for others, the Justice Department announced today. The civil injunction order, to which the Gutierrezes consented without admitting the allegations against them, was signed yesterday by Judge Orlando L. Garcia of the U.S. District Court for the Western District of Texas. The injunction permits their companies, FCRE Inc., Fast Cash Refund Express Electronic Tax Service LLC, Fast Cash Refund Express and Fast Cash Express Electronic Services, to continue to operate, though the Gutierrezes must sell their interests in these businesses and take no role other than administrative matters until they are sold. While the companies operate, they are permanently barred from promoting any false tax schemes and from advising or encouraging taxpayers to attempt to evade their correct federal tax liabilities. Each of the businesses and the Gutierrezes must turn over the names of the people for whom they prepared tax returns or claimed tax refunds since Jan. 1, 2012.
The government’s complaint alleged that Pete and Jeannette Gutierrez, through their companies, which have offices in San Antonio, prepared federal tax returns for customers that claimed false and exaggerated personal deductions, business deductions, educational and energy tax credits, and other tax credits to which their clients were not entitled, in order to unlawfully understate tax liabilities. As alleged in the complaint, the amount of tax loss resulting from these improper tax preparation activities likely exceeds $3 million for the years 2006 through 2010.
The IRS lists tax-preparer fraud as one of the “Dirty Dozen” tax scams. The Justice Department has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters in the past decade. Information about these cases is available on the Justice Department website.