Jeff Cunningham Quoted in The Atlanta Journal-Constitution
"Jackson Hewitt: Tax firm starts inquiry"

The article "Jackson Hewitt: Tax firm starts inquiry" in the April 7, 2007 Atlanta Journal-Constitution reports that a Marietta, GA-based Jackson Hewitt Tax Services franchisee hired an ex-commissioner of the Internal Revenue Service, to "investigate federal allegations of massive tax fraud against Farrukh Sohail, who operates more than 125 Jackson Hewitt franchises in Georgia, Illinois, Michigan and North Carolina. Sohail, along with more than 20 other defendants, is accused of fleecing the government out of more than $70 million by filing fraudulent tax returns on behalf of clients. He was described as a full or joint owner in the five corporations named as defendants in the four lawsuits. Legal experts say having Goldberg run an internal probe is an attempt to shore up credibility with investors and law enforcement. The move is also an attempt by the company to distance itself from any alleged wrongdoing by any franchisee, said Jeff Cunningham, a tax attorney and partner with Seyfarth Shaw in Atlanta. "Obviously, the company is going to build a case that as an enterprise they provide adequate training and they have policies and procedures in place that are intended to catch and curtail persistently incorrect filings, and that this franchisee was basically a rogue agent," said Cunningham, who has represented clients before the IRS. What federal investigative authorities will be looking for are what he called "badges" of fraud —- instances of ongoing, willful intent to cheat the government. "Things like persistent patterns of underreporting income or overstated deductions or exemptions," Cunningham said. "That's going to be over a period of several years in the case of a paid tax preparer." That the government acted now isn't an accident, given the deadline for filing federal taxes is April 17 —- 10 days away —- he said. "The IRS has been concerned about tax preparer fraud for some time."