We hate it when our clients or even citizens are subject to a scam. Which is why we share all instances with our readers to help them avoid it. Today’s scam has to do with a dishonest tax prepper and how a bookkeeper can destroy your business.
How the Business Tax Scam Worked
The tax prep firm basically set up shop and filed tax returns on behalf of their clients. They also filed false information for PPP loans, the Paycheck Protection Program that was offered to businesses during COVID. Clients were issued their tax refunds (and possibly PPP loans) and everyone was happy. However, these returns and loans turned out to be fraudulent. He was finally caught and pled guilty in September of 2024. However, this was after stealing over $10 million from a variety of parties.
It is unclear as to what happened to all the clients he filed false returns for. However, we suspect they will have to at least bear the cost of refiling, giving back the refunds, and even paying any outstanding amounts. They may also be subject to paying penalties, fees, and interest – even though they are not at fault.
Sixty-five year old Festus Adenisimi pleaded guilty in September 2024 to a single count of Conspiracy to Defraud the U.S.A. – Source: Department of Justice
Who Was the Bookkeeper?
The perpetrator was FA Tax located in Mansfield, Texas. This is a shame because our state is full of such great people and businesses. The owner was sentenced to 57 months in federal prison. He was also ordered to pay back the over $10 million he stole. Those of you who were clients of his are immediately urged to have a qualified bookkeeper review all the returns he and his business processed and file a complaint if it was done incorrectly.
How to Avoid This Scam
The best way to avoid this scam is to have a proper tax return professional at your beck and call. They should be local, have a long history of working in the area, and have many satisfied and long-term clients. Be wary of tax return firms that are “too good to be true.” They may offer you items like:
- They may guarantee tax refunds no matter what.
- A cut of your refund as payment.
- They may offer free or low cost tax preparation services. There are charities who do this type of work, but a tax return firm should not.
More on How A Bookkeeper Can Destroy Your Business
If you want to avoid this and all other types of bookkeeping scams, feel free to contact our office. We have been in business for decades and have many business, individual, and other clients – as well as a clean record.