Justice Department Sues to Stop Georgia Man From Promoting Alleged Tax-Fraud Scheme

The following press release was published by the US Department of Justice on Sept. 21, 2005. It is reproduced in full below.

FOR IMMEDIATE RELEASE WEDNESDAY, SEPTEMBER 21, 2005 WWW.USDOJ.GOV TAX (202) 514-2007 TDD (202) 514-1888 Atlanta Man Allegedly Helps Customers Falsely Claim They Are Exempt From Federal Taxes as Members of Purported Native American Tribe WASHINGTON, D.C. - The Justice Department today asked a federal court in Georgia to stop Derrick Sanders, of Atlanta, from promoting an alleged tax-fraud scheme involving false claims that Native Americans are exempt from federal income taxes. The government’s civil injunction complaint, filed in the U.S. District Court for the Northern District of Georgia in Atlanta, also seeks a court order requiring Sanders to give the Justice Department his customers’ names, mailing and e-mail addresses, and telephone and Social Security numbers.

According to the complaint, Sanders allegedly claims to be the Grand Master Consul of the so-called Yamassee Native Americans of Eatonton, Georgia, which was previously allegedly known as the Nuwaubian Nation of Moors. Sanders allegedly prepares forms for customers to use to instruct their employers to stop withholding taxes from their wages on the ground that Yamassee members are not subject to federal income taxes. The complaint states that the Yamassee group has not been recognized as an Indian tribe by the government, and that in any event all U.S. citizens and residents, including Native Americans, are subject to federal income taxes.

"Peddlers of tax scams and those who participate in them cheat all law-abiding taxpayers," said Eileen J. O'Connor, Assistant Attorney General for the Justice Department's Tax Division. "The Department of Justice and the Internal Revenue Service are working diligently to stop the promotion of tax fraud." This injunction suit is part of an effort to stop the promotion of tax scams and the preparation and filing of false and fraudulent returns. The Justice Department has obtained injunctions against more than 100 promoters and tax-return preparers since 2001. More information about these cases is available at http://www.usdoj.gov/tax/taxpress2005.htm. More information about the Tax Division is available at http://www.usdoj.gov/tax/index.html. 05-494

Source: US Department of Justice