Justice Department Seeks to Shut Down Ohio Promoter of Alleged Tax-fraud Scheme
Zanesville, Ohio Man Allegedly Promotes Several Tax-Fraud Schemes
The Justice Department announced today that it has asked a federal court in Columbus, Ohio, to permanently bar John Allen from promoting tax-fraud schemes and preparing federal tax returns. The civil injunction lawsuit alleges that Allen, who does business as Allen & Associates, promotes several schemes involving the preparation of fraudulent federal income tax returns based on the false premise that his customers do not receive “wages” as defined by law.
The complaint alleges that Allen has promoted at least three tax-fraud schemes, moving from scheme to scheme when the Internal Revenue Service (IRS) identifies the bogus nature of the tax returns that are filed as part of Allen’s arrangement. The complaint alleges that, as part of the promotion, Allen prepares his customers’ tax returns, but does not sign the returns as the preparer. According to the complaint, Allen prepares frivolous letters addressed to the Secretary of the Treasury and the commissioner of the IRS on behalf of customers, and also aided a customer in an attempt to file a frivolous lien against the United States by preparing a bogus lien document and directing his customer to file it. Allen allegedly solicits up-front fees of $250 from customers to prepare their returns and handle any correspondence with the IRS, and asks for a “donation” of 10% of any refund issued to his customers by the IRS.
The complaint further alleges that Allen falsely holds himself out as an attorney to his customers and to third parties, including the IRS, despite being enjoined from the unauthorized practice of law by the Supreme Court of Ohio.
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.