Mo Money employees indicted in education tax credit scheme - Action News 5 - Memphis, Tennessee

Mo Money employees indicted in education tax credit scheme

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(WMC-TV) – More problems for Mo Money. Action News 5 has learned new details from inside indictments against five tax company employees. 

This federal indictment says the Mo Money employees and owner of the franchise specialized in the education tax credit.  A scheme the feds say worked this way: taxpayers were given the credit worth thousands of dollars even though those taxpayers never took any classes. 

"I used it myself while I was in college," said taxpayer David Underwood. "So people abusing it is kind of eye opening. You don't want people abusing something that's intended for people getting an education."  

But that is exactly what the federal government says three tax preparers from Memphis and two from St. Louis did at a Mo Money Franchise in St. Louis. The franchise was owned by Memphian Jimi Clark according to the federal indictment.  The group is accused of falsely claiming education tax credits on at least 47 2009 tax returns.

According to the federal indictment, the Mo Money Franchise in St. Louis hired people who were familiar with the education tax credit then gave them more training at the office. 

The indictment says most of the educational tax credits on the individual returns amounted to around 37 hundred dollars. The taxpayers never incurred those education expenses. 

Half of the returns prepared by the Mo Money franchise claimed the credits. 

This isn't the first problem for Mo Money franchises. The corporate headquarters was searched by the IRS agents earlier this year after accusations the company bilked consumers with hidden fees and inaccurate tax returns. 

"I would be extremely mad at someone that took tax money and taxpayer money and used it for things they said they were going to use and didn't use at all," said taxpayer Curt Robinson.  

The five Mo Money employees were arrested in Memphis and St. Louis today on a charge of conspiracy to commit tax fraud. They face a maximum of five years in prison.  

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