WASHINGTON – A federal court in Pensacola, Fla., has entered a preliminary injunction barring Pinnacle Quest International (PQI) and its principals from publicizing tax fraud schemes that have been promoted to customers from all over the United States, the Justice Department announced today. The order, which remains in effect indefinitely, comes in advance of a PQI conference scheduled for May 18, 2008, in Cancun, Mexico.
Last month the Justice Department filed civil injunction complaints in three federal courts on the east and west coasts, seeking to bar promotions of tax fraud schemes. The complaint against the Fort Walton Beach, Fla.-based company described the foreign conferences where it promotes its schemes as “tax fraud trade shows.” The court agreed, finding that PQI and its executive council “knowingly” allow vendors at PQI conferences to make false and fraudulent statements about the tax benefits of schemes they promote.
The court found that one speaker at PQI sales conferences was former Internal Revenue Service (IRS) agent Sherry Peel Jackson, a tax defier who recently was convicted of federal tax crimes and sentenced to four years in prison. The court noted that Jackson advanced her frivolous tax arguments in PQI’s promotional materials.
In entering the injunction, Senior U.S. District Judge Roger Vinson held that PQI and its executive council promote tax-fraud products through an extensive multilevel marketing system with 830 salespeople and more than 11,500 customers. The court found that PQI salespeople earned $38 million in sales commissions from 2002 to 2006, and that the company’s promotions have cost the U.S. Treasury more than $12 million.
Since 2001, the Justice Department’s Tax Division has obtained injunctions against more than 335 tax fraud promoters and unscrupulous tax preparers. Information about these cases is available on the Justice Department Web site.
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