FOR IMMEDIATE RELEASE |
TUESDAY, JULY 27, 2004
TDD (202) 514-1888
JUSTICE DEPARTMENT SUES TO HALT PREPARATION OF FRAUDULENT TAX RETURNS BY EAST CLEVELAND TAX-RETURN PREPARER
Allegedly Frivolous Returns Omit All Wage Income Earned by Preparer's Customers
WASHINGTON, D.C. - The Department of Justice filed a lawsuit in federal court in Cleveland today to stop author and tax return preparer Michael A. Allamby, of East Cleveland, from preparing federal tax returns for customers. The civil injunction suit also seeks to prevent Allamby from promoting an alleged fraudulent tax scheme under which wages are omitted from taxpayers’ tax returns, and to turn over his customer list to the Justice Department.
According to the complaint, filed in the U.S. District Court for the Northern District of Ohio, Allamby prepares federal income tax returns for Cleveland-area residents that report zero total income and request refunds of all federal income taxes withheld. The suit alleges that Allamby reports zero total income on his customers' returns, despite filing the returns with attached W-2 Forms indicating that the customers have received thousands of dollars in wages or salaries. The complaint states that, since January 2000, the IRS has processed hundreds of returns Allamby prepared.
"Preparers of frivolous tax returns and their customers face civil and possibly criminal penalties for their actions," said Eileen J. O'Connor, Assistant Attorney General for the Justice Department's Tax Division.
According to the complaint, Allamby also conducts "training courses" across the country at which he promotes his views and solicits customers for his return-preparation business. Court papers allege that he has conducted ten courses since 2000, including courses in Detroit and New York City within the past year. The complaint alleges that Allamby has also written a book, To the Best of My Knowledge and Belief, in which he encourages readers to file tax returns that omit wages from income. In addition to seeking to enjoin Allamby from preparing future tax returns, the government seeks to halt the seminars and book sales through an injunction against Allamby that bars him from advertising, marketing, or promoting any false, misleading, or deceptive position, including the position that wages are not taxable income.
More information about the Justice Department's ongoing efforts to halt the promotion of tax scams can be found at http://www.usdoj.gov/tax/taxpress2004.htm. Information about the Tax Division is available at http://www.usdoj.gov/tax/index.html.