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A Miami area mother and daughter team who promised African-Americans they could help them recover a nonexistent $40,000 income tax credit for slavery reparations is out of business, and the two women will have to pay a $10,000 fine. Late last month, the civil rights division of the Florida attorney general’s office in Fort Lauderdale officially shut down Susan’s Travel and General Service. Owners Susan M. Sanchez and her mother, Susana A. Sanchez, signed a consent agreement to close their tax preparation business. In exchange, the Florida attorney general’s office dropped its civil case against them. The women could still face criminal charges. The women operated out of a home in unincorporated Miami-Dade County at 830 NW 111th St. A small sign advertising notary services is the only thing that remains of the business. A “For Sale” sign has been posted out front. “I am trying to sell the property so I can pay [the fine],” Susana Sanchez says. “This has destroyed my life. I lost my job and everything.” The women first came to the attorney general’s attention last year after fliers offering their services were circulated in the African-American community. The circular advertised the availability of a “black tax credit;” it claimed that blacks have overpaid their taxes. The circular distinguished this alleged tax credit from the more familiar concept of post-slavery restitution to blacks in the form of 40 acres and a mule. According to documents filed in Miami-Dade Circuit Court, more than 100 people fell for the Sanchez tax credit scheme and paid a $100 fee. In addition, the clients signed an agreement to pay the Sanchezes 2 percent of the mythical $40,000 they would receive. The flier warned that contacting the Internal Revenue Service directly to ask about the tax credit might hinder the chance of collecting the money, because, it said, the IRS didn’t want to be flooded with calls, “nor do they want the tax credit advertised to the general public.” Unfounded claims that blacks are entitled under existing law to reparations for their generations of slavery in the American colonies and the United States are nothing new. In 1993, magazines published articles telling African-Americans that they could file claims with the IRS for reparations payable to the descendants of slaves. The basis for such claims dates to Reconstruction, when Congress voted to provide former slaves with 40 acres and a mule as compensation for the injustice of slavery. President Andrew Johnson vetoed the bill. “Because reparations is an issue that’s been discussed in legitimate publications, I think [the Sanchez women] were preying on that,” says Allison Bethel, director of the civil rights division of the attorney general’s office in Fort Lauderdale, Fla. “Whether you call it reparations or a tax credit, the fact is, nothing has been awarded to African-Americans for slavery damages,” says Bethel. There currently are legitimate legal efforts being discussed to win reparations for African-Americans. Earlier this year, a team of lawyers and black activists led by Professor Charles Ogletree Jr. of Harvard Law School and Randall Robinson of TransAfrica Forum, an African-American policy group, announced plans to file a lawsuit seeking reparations for slavery. The group, which calls itself the Reparations Coordinating Committee, still has many vexing issues to work out, including who the plaintiffs and defendants will be. It hopes to file the suit sometime next year. The Sanchez women’s operation was not unlike a number of other reparation schemes that have operated around the country over the years. The attorney general’s office alleged that the two women were engaging in unfair and deceptive trade practices. They instructed their clients to fill out Form 2439, which is “a notice to shareholder of undistributed long-term capital gains to collect.” Though the IRS does publish Form 2439, it has nothing to do with any tax credit exclusively for African-Americans. Susana Sanchez could not explain the rationale for the tax credit she was peddling to African-Americans. She claims it was a client who gave her the idea. “A lot of people in Florida were doing this,” she says. “I wasn’t the only one, but I was the only one they punished.” Bethel says she’s unaware of any other such operations, and that Sanchez never offered any leads. “Had she done so, we would have happily included them, too,” Bethel says. Taxpayers were warned about such schemes in a news release issued by the IRS in August 2000. They also were warned that they could face civil and criminal penalties if they participated. IRS spokesman Michael Dobzinski, who works in the agency’s Fort Lauderdale office, said at the time that the IRS had detected as many as 90 returns totaling $3.6 million in false claims for tax credits. On Monday Dobzinski said his office is still hearing about people filing similar claims, but that the people profiting by promoting these false claims are packaging it differently. “I have heard of claims being filed for getting back some of your Social Security benefits,” says Dobzinski. “It’s still out there, but it has taken a different shape or form.” He warns that such claims will be rejected, and that anyone caught trying to file such claims could face a $500 frivolous return penalty. Still, he notes that the IRS is more interested in going after promoters like Sanchez than in prosecuting their dupes. Susana Sanchez claims that she returned all of the money she collected from her unwitting black clients.

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