JUSTICE DEPARTMENT SUES TO HALT GEORGIA MAN'S ALLEGED TAX SCAM

Suit Alleges that Morris James Sr. Promotes a Fraudulent "Slavery Reparations Tax Credit"

  WASHINGTON, D.C. – The Department of Justice today asked a federal court to stop Morris James Sr. and his company, National Resource Information Center, both of Montezuma, Ga., from promoting a nationwide, slavery-reparations tax scam. According to papers filed by the Justice Department in federal court in Macon, Ga., James promotes the scam by selling "tax information packages" at meetings held in churches throughout the United States. According to court papers, the defendant and his organization provided bogus tax-return-preparation services for more than 6,300 customers known to have purchased the packages.

"Claiming tax benefits for slavery reparations, segregation, treatment as a second-class citizen, or on other similar grounds is illegal," said Eileen J. O'Connor, Assistant Attorney General for the Justice Department's Tax Division. "The Justice Department is taking vigorous action to stop schemes that undermine the federal tax system and leave honest taxpayers footing the bill." The Internal Revenue Service has included the slavery reparations scam on the list of the "Dirty Dozen" tax scams that the agency has specifically urged taxpayers to avoid. The whole list can be found at: http://www.irs.gov/newsroom/article/0,,id=107493,00.html.

Efforts by the IRS and Justice Department to shut down tax scams based upon slavery reparations and similar claims have resulted in a 97 percent drop in these claims in recent years, according to testimony by Dale Hart, Acting Deputy Commissioner of the IRS's Small Business-Self Employed Operating Division, before the Senate Finance Committee. The Justice Department has previously obtained injunctions to stop five other reparations-scam promoters or return preparers: Willie Haugabook of Montezuma, Ga.; Eddie and Erma Mims of Sylvania, Ga.; Robert Foster of Richmond, Va.; and Andrew L. Wiley, of Durant, Miss. For more information on these cases go to http://www.usdoj.gov/tax/taxpress2003.htm. The Department has also prosecuted reparations promoters. In October 2001, Vernon T. James of Carrollton, Texas, was convicted for preparing false, fictitious and fraudulent federal income tax returns claiming the reparations credit. Last year, a federal judge sentenced James to more than six years in prison and ordered him to pay $1.2 million in restitution.