Tsehaye's brother, Alferom Goitom, was barred from preparing federal tax returns last year. In December, the government received a permanent injunction barring Las Vegas, Nev.-based Instant Tax Franchisee, Koraggio LLC, and its co-owner Benyam Tewolde from preparing taxes. His wife and co-owner, Yordanos Kidanits, agreed not to violate federal tax laws. A trial has been scheduled for May on the government's request to shut down the Dayton, Ohio-based franchisor, ITS, and its owner, Fersum Ogbazion.
Another Instant Tax Franchisee Banned
Government action to remove Instant Tax Service franchisees and its parent - which the Justice Department accuses of systemic fraud - from preparing taxes continued this month. A federal court in Kansas City, Kan., permanently barred franchisee A&S Tax Service from operating or preparing federal tax returns for others. A preliminary injunction was entered in Ohio against the parent, ITS Financial, and its owner in November.
In Kansas, Semere Tsehaye of St. Louis, owner of A&S, was permanently enjoined from engaging in certain abusive practices. Tsehaye and his company agreed to the order without admitting any allegations and also agreed to pay $100,000 in civil tax penalties. The defendants operated Instant Tax offices in the Kansas City metropolitan area and allegedly instructed employees in how to engage in systemic and pervasive tax fraud, including routinely preparing tax forms falsely claiming education and dependent-care credits, reporting items pertaining to phony companies, and reporting fictitious income and expenses in order to fraudulently inflate the Earned Income Tax Credit."
