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United States v. Kyle

July 11, 2008

UNITED STATES OF AMERICA, PLAINTIFF,
v.
ROOSEVELT KYLE, INDIVIDUALLY OR D/B/A CENTURY ONE RESORTS, LTD OR CENTURY ONE ASSOCIATES; REBECCA TYREE A/K/A/ RUBEE TYREE OR RUBY TYREE; COA FINANCIAL GROUP, LLC D/B/A COA FINANCIAL NETWORK TRUST C/O T&N COA FINANCIAL GROUP, LLC AND EAGLE FINANCIAL SERVICES, LLC DEFENDANTS,
ROOSEVELT KYLE, THIRD-PARTY PLAINTIFF
v.
JOHN R. MONROE, DOES 1 THROUGH 1000 THIRD-PARTY DEFENDANTS.



The opinion of the court was delivered by: Irma E. Gonzalez, Chief Judge United States District Court

ORDER GRANTING MOTION FOR DEFAULT JUDGMENT FASHION; AGAINST EAGLE FINANCIAL SERVICES, LLC

Plaintiff United States filed its complaint for permanent injunction under sections 7402, 7407, and 7408 of the Internal Revenue Code (26 U.S.C. or I.R.C.) on November 15, 2007, seeking to bar defendants COA Financial Group, LLC ("COA") and Eagle Financial Services, LLC ("Eagle"), from preparing income tax returns for others. COA and Eagle were properly served and have failed to appear in this matter. Entry of default was made against them on January 7, 2008 (Doc. Nos. 15 and 16). Having reviewed the record in this case, the Court makes the following findings of fact and conclusions of law and enters this permanent injunction against COA and Eagle.

Findings of Fact

1. This Court has jurisdiction over the parties and subject matter in this case.

2. COA Financial Group, LLC, and Eagle Financial Services, LLC, in this judicial district have engaged in conduct subject to penalty under I.R.C. §§ 6694, 6695, or 6701 and have engaged in conduct that interferes with the proper administration of internal revenue laws.

3. Over the last eight years, Defendant Roosevelt Kyle has operated his tax preparation business using several entities or names, including COA Financial Group, LLC, and Eagle Financial Services, LLC. Kyle stopped personally signing returns in 2004, but Kyle still interviews customers and prepares returns that are signed by others. He does this to thwart IRS efforts to detect his illegal conduct.

4. The following numbers of returns were filed under the Employer Identification Numbers of COA and Eagle and under Kyle's identification number:

Name of Person/EntityNumber Returns Filed by Entity from 2000-2007:         20002001200220032004200520062007*fn1 Roosevelt Kyle15721632186413612215 Century One Resorts145125115742 COA Financial Network Trust/COA Financial Group, LLC2527347 Eagle Financial Services, LLC1136

5. Defendant Eagle Financial Services, LLC, was formed in January 2007 and Roosevelt Kyle is listed as its agent for service of process. Kyle reopened his tax preparation business as Eagle Financial Services, LLC, in 2007 after he was released from prison.

6. COA Financial Group, LLC, was formed in June 2004 and Roosevelt Kyle is its agent for service of process.

7. On average Kyle and his businesses prepared and filed approximately 1,500 returns per year since 2000.

8. Kyle most recently operated his business from 2414 Hoover Avenue, National City, CA 91950, in the San Diego metropolitan area.

9. Kyle, COA and Eagle, prepare returns that unlawfully understate their customers' tax liabilities, most commonly by fabricating or inflating deductions on Schedule A, "Itemized Deductions," and Schedule C, "Profit or Loss from Business."

10. COA and Eagle's customers are generally wage earners who are not familiar with internal revenue laws, rules and regulations.

11. COA and Eagle generate new business through word of mouth as they gain a reputation for being able to generate larger tax refunds than other return preparers.

12. As a direct result of COA and Eagle's fraudulent return preparation, their customers have filed federal income tax returns understating their federal income tax liabilities and claiming large income tax refunds to which they were not entitled.

IRS's Investigation

13. As of September 26, 2007, the IRS has examined approximately 254 returns prepared between 2002 and 2007 by Kyle and Tyree under the auspices of Century One Associates, COA ...


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