WASHINGTON - The Justice Department announced today that it has sued a federal income tax preparer in U.S. District Court in Miami seeking to bar her from preparing tax returns for others. According to the government’s civil injunction complaint, Tashanna McFarland of Miramar, Fla., prepared federal tax returns claiming fraudulent fuel tax credits, a scam that the complaint explains is a serious enforcement problem for the Internal Revenue Service (IRS). The suit alleges that McFarland operates her tax preparation business out of a booth at a flea market in Miami.

Federal law imposes a fuel tax on gasoline and diesel fuel sold in the United States. The tax is included in the purchase price at the pump. Businesses can claim a fuel tax credit in certain rare circumstances, but most businesses and consumers who use cars or trucks on roads and highways are not eligible for the credit. According to the government’s complaint, McFarland claimed the fuel credit on her customers’ returns so they could claim tax refunds to which they were not entitled.

The complaint says that on a return for one customer—a babysitter—McFarland claimed that the customer purchased 16,451 gallons of gasoline for business-related purposes. The suit notes that for such a claim to be accurate, the babysitter (whose total income for the year was $9,316) would have had to spend approximately $36,192 for gasoline that year—nearly four times her total income—and would had to have driven approximately 246,765 miles during the year, an average of 676 miles each day, seven days a week.

The government complaint alleges that McFarland has prepared at least 970 returns since 2003 and the IRS has identified over $1.5 million dollars in fraudulent fuel tax credits on McFarland-prepared returns. “People who have their returns prepared by others should review them carefully to make sure they are truthful,” said Eileen J. O’Connor, Assistant Attorney General for the Justice Department’s Tax Division. “The preparer who seems to be saving you taxes now is setting you up for trouble later, when the IRS realizes that you filed a false return and obtained a larger refund, or paid less in taxes, than you should have.”

“This problem is primarily being caused by unscrupulous tax return preparers located across the country," said Kathy Petronchak, Commissioner of the IRS Small Business / Self Employed Division. "The IRS is working closely with the Department of Justice to stop this behavior."

Since 2001, the Justice Department’s Tax Division has obtained more than 215 injunctions to stop the promotion of tax fraud schemes and the preparation of fraudulent returns.

Former US Army Sergeant Ricky Clousing, a paratrooper and interpreter who disputed the legality of the war in Iraq, was released Saturday from a military prison where he was serving a three-month sentence after pleading guilty to going absent without leave for 14 months. Clousing was released 15 days early for good conduct and is headed home to Washington state.

In October, a court-martial in Fort Bragg, NC, sentenced Clousing to 11 months' confinement, with all but three months suspended, under a plea agreement that allowed him to avoid a finding of desertion. Clousing abandoned his post at Fort Bragg after reporting abuses committed by fellow soldiers during his five-month stint in Iraq. Clousing refused to request conscientious objector status to receive a discharge because he said he does not believe all wars are wrong. After 14 months AWOL, Clousing turned himself in at Fort Lewis, WA.

Former Tyco executive Richard "Skip" Heger reached a $450,000 settlement on financial reporting and record-keeping charges, the US Securities and Exchange Commission announced  Thursday. The charges are connected to a fraud case in which Tyco agreed to pay a $50 million civil penalty and a $1 disgorgement fee for fraudulent accounting procedures used between 1996 through 2002. Heger, who at the time was in charge of the company's fire and security services division finances, was accused of approving financial results that he knew, or should have known, were inflated; he reached the settlement without entering a plea on the charges. Two other former executives, Richard Power and Edward Federman, were charged with fraud in overstating Tyco's operating income by hundreds of millions of dollars through the use of a sham transaction.

In the sham transaction, Tyco imposed a $200 “dealer connection fee” that it purportedly required independent dealers to pay. Tyco simultaneously increased the price it paid each dealer by the same $200, the SEC said. The transaction had no economic substance, but boosted income because the connection fee was recognised immediately as income and the $200 dealer payment was treated as a capital expenditure that was amortised over 10 years, the SEC said.

The April settlement allowed Tyco to avoid admitting any of the allegations in the SEC's complaint. According to the SEC, Tyco executives inflated key figures - including its operating income by more than $567 million and its cash flow by $719 million - in official reports to the SEC. Former Tyco CEO Dennis Kozlowski and former CFO Mark Swartz were found guilty of looting the company and its shareholders out of more than $150 million in unauthorized personal compensation, and have been sentenced to prison for 8 to 25 years. The company still faces a likely onslaught of shareholder litigation, which analysts predict could cost the company up to $4 billion.

The SEC said that PricewaterhouseCoopers LLP, Tyco’s outside accountant, raised concerns about the $200 payment to dealers. In response, Tyco stopped calling the $200 payment a “growth bonus” and repackaged the payment as a $200 increase in the purchase price for each monitoring contract, the SEC said.

Gov. Rod Blagojevich's administration told a federal judge Monday night that it will pay legal fees in a lost lawsuit over video-game restrictions by late January.

Lawyers for Blagojevich and Atty. Gen. Lisa Madigan said they had decided to pay the $520,000 fee from unspent money in the budgets of several agencies under the governor.

The document filed in federal court in Chicago indicated necessary paperwork would be to the state comptroller by Friday.

Video-game industry representatives sued Blagojevich and Madigan last year over a law the governor promoted that made it a crime for retailers to sell violent or sexually explicit video games to minors.

The overall 3.7 percent uptick in violent crime between January and June comes amid a still-incomplete Justice Department study of 18 cities for clues on why criminal activity is increasing.

Property crimes like auto theft and other larcenies were down by 2.6 percent over the same six-month period, the data show. But the number of arsons shot up by nearly 7 percent, the FBI reported.

If the numbers stay at the current pace, the rate of violent crime will increase in 2006 for the second year in a row. The FBI's 2005 annual report on violent crime showed that violent crimes increased in 2005 for the first time since 2001; the 2.3 percent increase was the largest jump since 1991. The US Justice Department has launched an investigation to examine why the violent crime rate has increased.

“This is a concern we’ve been focused on,” said Gene Voegtlin, legislative counsel for the International Association of Chiefs of Police, which represents an estimated 20,000 law enforcement officials and has been pushing for more crime-fighting funding. “A lot of (police) agencies are really stretched thin when it comes to the budget and their ability to aggressively combat crime.”

The Justice Department did not have an immediate comment.

Florida Governor Jeb Bush suspended all executions in the state Friday after a medical examiner said that the execution of Angel Diaz earlier this week was botched. Diaz endured a 34-minute-long execution and medical examiner Dr. William Hamilton said Friday that preliminary autopsy results showed that a second injection was required in the execution because needles were improperly inserted into the flesh of Diaz's arm during the first injection. Hamilton did not specify whether he believed Diaz suffered a painful death. Bush appointed a commission to study Florida's lethal injections procedures and the governor halted the signing of death warrants until the commission submits its report.

After the botched execution Wednesday, death penalty critics filed an emergency petition with the Florida Supreme Court seeking to once again halt the death penalty in the state. Petitioners, including numerous people currently on Florida's death row roster, asked the court to exercise its All Writs jurisdiction and declare that the state's lethal injections procedures violate the Eighth Amendment of the US Constitution.

One day after Florida death row inmate Angel Diaz endured a 34-minute-long - and apparently painful - execution, death penalty critics filed papers with the Florida Supreme Court seeking to once again halt the death penalty in the state. Petitioners, including numerous people currently on Florida’s death row roster, filed an emergency petition Thursday with the court asking it to exercise its All Writs jurisdiction and declare that Florida’s lethal injections procedures violate the Eighth Amendment of the US Constitution.

Angel Diaz was executed Wednesday for the 1979 murder of a Miami strip club manager. Officials had to administer the sodium pentothal, pancuronium bromide, and potassium chloride cocktail twice, during which time witnesses claim he grimaced, contorted, and gasped for breath. Officials claim that Diaz had a liver condition that slowed the absorption of the drugs, but that he was unconscious and experienced no pain. The US Supreme Court reviewed Florida’s lethal injection procedure earlier this year when they stayed the execution of Clarence Hill, who was ultimately executed in September. 

Governor Jeb Bush asked Corrections Secretary James McDonough to undertake a thorough review of the execution, including an autopsy and interviews with those in the death chamber. Diaz' lawyer filed a lawsuit Thursday on behalf of death row inmates, asking the Florida Supreme Court to rule that the state's lethal injection procedure is unconstitutional.