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Friday, July 14, 2017

Justice Department Seeks to Shut Down Atlanta-Area Tax Return Preparer

Owner of Precise Tax Services Allegedly Prepares Fraudulent Tax Returns Reporting Fabricated Income and Expenses and Claiming Phony Fuel Tax Credits

The United States filed a civil injunction suit seeking to bar Marjorie St. Jean and her company MarjorieStjeanLLC, from owning, operating, or franchising a tax return preparation business and preparing tax returns for others, the Justice Department announced today.

The complaint filed in the U.S. District Court for the Northern District of Georgia, also requests that the court order St. Jean and MarjorieStjeanLLC to disgorge the fees that they obtained through the preparation of allegedly false returns. According to the complaint, St. Jean of McDonough, Georgia, currently owns and operates a tax preparation store called Precise Tax Services. This tax preparation store is located at 7206 Tara Blvd. in Jonesboro, Georgia, according to the complaint.

The government alleges that St. Jean prepares and files tax returns that unlawfully increase her customers’ refunds, and she profits through excessive, often undisclosed preparation fees—at the expense of her customers and the U.S. Treasury. The complaint alleges that St. Jean and her company, MarjorieStjeanLLC, engage in fraudulent activity, including:

• Falsely claiming Fuel Tax Credits;

• Falsely claiming the Earned Income Tax Credit;

• Fabricating businesses and related business income and expenses;

• Fabricating deductions, particularly for unreimbursed employee business expenses; and

• Charging deceptive and unconscionable fees.

According to the complaint, St. Jean was previously an employee of LBS Tax Services, where she worked at a tax preparation store owned and operated by Douglas Mesadieu. A federal court previously barred Mesadieu from preparing federal tax returns for others and owning and operating a tax preparation business, finding that “Mesadieu and his companies have been unjustly enriched by fraudulently inflating the EITC on the tax returns they prepared for customers in order to increase a taxpayer’s tax refund.” Since September 2014, the United States has filed 15 similar lawsuits in Florida and North Carolina against the former LBS Tax Services franchisor, Walner Gachette, and former LBS franchisees and managers, many of whom allegedly rebranded as new businesses and continued to operate tax preparation businesses. Through these lawsuits, the United States has obtained numerous permanent injunctions and money judgments requiring defendants to disgorge millions in ill-gotten tax preparation fees.

Return preparer fraud is one of the IRS's Dirty Dozen Tax Scams for 2017. The IRS has some tips on their website for choosing a tax preparer. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

Press Release Number: 
Updated July 14, 2017