According to the Internal Revenue Service, the Memphis Franchise owner of Mo’ Money Taxes Jimi Clark and several of his employees were arrested for fraud on Wednesday. The IRS alleges the individuals falsely claimed educational tax credits on 47 filed returns in the year 2009.
This is not the first time the tax preparing service has faced federal scrutiny. The high-profile Memphis firm, one of the largest tax preparers based in Tennessee, has struggled in the recent months against pending allegations. Its headquarters underwent a change, as its sign was replaced by Southern King Taxes last month.
Before the arrests occurred, IRS officers had entered and removed boxes of records from the head office located at 5090 Millbranch. The firm has also garnered attention from attorney general offices in the states of Missouri and Illinois after hundreds of clients complained that they did not receive refund checks. Whether or not the raid has any implications on the case against Clark remains to be seen.
The individuals were indicted by a federal grand jury on October 10. All were indicted on one felony count each of conspiracy to commit tax fraud.
In a statement released on Wednesday, the IRS discussed the allegations saying, “The defendants were trained on educational tax credits including the American Opportunity Credit.” The IRS also noted that Clark allegedly abused the program at the Mo Money franchise during the 2009 tax season in order to bring clients to the business and retain them. The statement indicated that at least 47 returns were falsely filed and inflated with American Opportunity Credit line items.
The Mo’ Money franchise, which caters to working class taxpayers, allegedly abused credits and filed false returns. It remains to be seen how the cases against the individuals will unfold.
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