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Friday, February 22, 2013

Justice Department Sues to Shut Down Tennessee Tax Return Preparers

Memphis, Tenn., Return Preparers Allegedly Overstate Refunds by Fabricating Education Credits and by Unlawfully Claiming Earned Income Tax Credits

The United States has asked a federal court in Memphis, Tenn., to permanently bar husband and wife team Ahmed Grant and Lillian Madyun from preparing federal income tax returns for others, the Justice Department announced today. According to the government complaint, Grant and Madyun have operated multiple tax return preparation businesses in the Memphis area, including SuperFast Taxes, MG Services, and most recently, Taxes-R-Us.

The complaint alleges that Grant and Madyun have prepared returns that unlawfully overstate refunds and understate tax liability through a variety of schemes. Specifically, the government alleges that Grant and Madyun have prepared returns that unlawfully claim the Earned Income Tax Credit for their clients by reporting fictitious Schedule C business income. The government alleges that Grant and Madyun also prepared returns that claimed the American Opportunity Credit, to which their clients were not entitled, without their clients’ knowledge or consent. According to the complaint, ninety percent of the American Opportunity Credits claimed on their clients’ returns were false. The complaint further alleges that Grant and Madyun improperly ensured that their clients’ refunds were deposited into their own business’s bank account. The estimated harm to the government is over $2 million for the 2010 tax year alone, and may be as high as $5 million, according to the complaint.

This lawsuit is part of the Justice Department’s nationwide crackdown on tax scams, including the preparation of fraudulent federal tax returns. In the past decade the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website .

Related Materials:

United States v. Ahmed Grant, et al.
Grant Madyun Complaint (PDF)

Press Release Number: 
Updated June 6, 2016