Two Toledo, Ohio tax service store managers have been indicted on federal fraud charges related to tax returns they prepared in 2011. The tax and loan scheme cost the government more than $250,000 according to an 82-count federal indictment in the U.S. District Court for the Northern District of Ohio.
Adonay "Eddie" Mehreteab, 27, of Fort Wayne, Ind., and Miranda Parr, 32, of Heath, Ohio, are charged with conspiracy, wire fraud and making false, fictitious or fraudulent claims to the Internal Revenue Service. Parr also faces a charge of aggravated identity theft. Mehreteab and Parr were released and ordered to appear in court early next month.
The Department of Justice says the two filed at least 114 false or fraudulent tax returns for 2011, resulting in a total return of $700,974 and a loss to the government of $265,510.
Mehreteab owned and operated two Instant Tax Service franchise offices, which he managed along with Parr. Instant Tax Services offered $1,000 holiday loans to potential clients at the end of 2011, and those who applied with Mehreteab were told that the loans were a partial advance on their estimated tax returns for that year.
Mehreteab and Parr preyed upon clients who were often not financially experienced, according to Steven Dettelbach, U.S. Attorney for the Northern District of Ohio.
According to the indictment, the pair used information given to them by the clients to file 2011 individual tax returns on behalf of those individuals, in some cases without their knowledge. In some instances, they filed returns containing correct information when the clients were present, but later added false items to the returns, such as false wages, false credits or incorrect dependents, in an effort to increase the return amount. Again, this often occurred without the clients knowledge.
His offices also charged fees typically between $500 and $1,000 that were deducted from the clients refunds without disclosing the fees before filing the taxes, according to court documents.
In August 2012, the U.S. Attorneys office in Toledo sought to obtain $4.3 million seized by the IRS from a bank account Mehreteab used to receive refunds from fraudulently prepared tax returns. A civil case connected to the seizure is pending.