Justice Department Seeks to Shut Down Florida Tax Return Preparers
Government Alleges Siblings Who Each Prepare Tax Returns and their Businesses are Making False Claims
The United States filed two civil injunction suits seeking to bar three siblings who prepare tax returns and their businesses from owning, operating, or franchising a tax return preparation business and preparing tax returns for others, the Justice Department announced today. The United States filed one complaint against Herve Erilus of Cocoa, Florida, and his business, Herve Erilus LLC. The government filed a second complaint against Gerline Erilus of Orlando, Florida and her two businesses, Gerline Erilus LLC and Elite Multi-Services LLC, and St. Fonie Erilus of Apopka, Florida and her two businesses, St. Fonie Erilus LLC and The Diversified Finance Solutions LLC.
The complaints, both filed in United States District Court in Florida, also request that the court require the Eriluses and their businesses to disgorge ill-gotten fees that they obtained from the U.S. Treasury through the alleged false tax return preparation.
According to the complaints, the Eriluses and their tax preparation businesses prepare and file tax returns to falsely increase their customers’ refunds, and profit through exorbitant, often undisclosed fees—at the expense of their customers and the Treasury.
The complaints allege that the Eriluses engage in misconduct, including:
- Falsely claiming the Earned Income Tax Credit
- Claiming improper filing status (i.e. head of household for married individuals)
- Fabricating businesses and related business income and expenses
- Fabricating deductions
- Charging deceptive and unconscionable fees
According to the complaints, the Eriluses worked at LBS Tax Services, and their brother, Walner Gachette, through Loan Buy Sell Inc., is the former franchisor of LBS. Since September 2014, the United States has filed 17 lawsuits in Florida and North Carolina including a suit against Gachette and suits against dozens of alleged former LBS franchisees and managers, many of whom, according to the complaints, rebranded and continued to operate tax preparation businesses. Through these lawsuits, the United States has obtained numerous permanent injunctions and money judgments disgorging 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 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.