Feds raid Mo Money Taxes headquarters

MEMPHIS, TN. (WAVY) - Agents with the Internal Revenue Service are conducting an operation at the headquarters of Mo Money Taxes in Memphis, according to NBC affiliate WMC-TV .

Mo Money Taxes has faced scrutiny in the Hampton Roads area for allegedly not providing tax refunds to clients. WAVY News 10 has extensively investigated the company and the allegations against it.

Complete Coverage: Mo Money Taxes

WAVY.com spoke to Mo Money Norfolk customers about the raid Wednesday. They were happy to hear their complaints at the IRS office did not fall on deaf ears.

"I got my money already, but still it shouldn't have taken that long," said Robert Spriggs. "This didn't have to happen."

Gladys Johnson, the viewer who sparked 10 On Your Side's investigation into Mo Money Taxes, says she is relieved to hear the federal government raided the Memphis headquarters.

"I feel justice is being served, so far," said Johnson. "I'm so glad for WAVY TV 10, y'all did an excellent job."

Just last week, 10 on Your Side called Mo Money headquarters and someone answered, proof they were still taking on clients.

Congressman Bobby Scott told WAVY.com on April 17 that while no charges were filed on a local level against the company, there could be charges on a federal level.

Congressman Scott released this statement regarding Wednesday's raid:

" In February, I called on the federal government to immediately investigate Mo Money Taxes when I first learned of the numerous complaints from my constituents in Hampton Roads. I was assured by the Department of Justice that federal law enforcement agencies would be doing everything in their power to appropriately investigate this business to ensure that there would be no more victims. While it is generally the practice of federal law enforcement agencies not to publicly comment on ongoing investigations, the raid in Memphis of Mo Money Taxes' headquarters shows that a robust federal investigation is underway."

Mo Money CEO Markey Granberry would not return any phone calls or text messages from 10 On Your Side Wednesday, but he spoke to a reporter at WMC-TV by phone.

The reporter tells WAVY.com Granberry said his company has been cooperating with the IRS from the start. Granberry also told the reporter that he asked the IRS to investigate because so many of his customers still haven't received their tax returns.

WAVY.com spoke with the president and CEO of up2U Wednesday. Up2U is the company who processed tax refunds for Mo Money Taxes.

President and CEO Eric Miller tells WAVY.com his company is now returning refund money to the IRS, and has been doing so since March 16.

Miller says Mo Money employees made more than 4,400 errors on tax returns. Miller says the checks were delayed because of the errors, and because his staff had to manually correct many of them.

Miller says the errors include returns with incorrect routing or account numbers, returns with very little taxpayer information, and in hundreds of cases two returns filed for one person.

Miller says he is not sure if filing multiple returns for one individual is a deliberate pattern. Even if it is, it's hard to prove whether the fraud was committed by the taxpayer or the tax preparer, says Miller.

As he has been going through returns, Miller says he has found at least 35 cases where taxpayers committed fraud. He says the confusion surrounding Mo Money Taxes presents the opportunity to the few with bad intentions.

When WAVY.com spoke to Miller by phone Wednesday afternoon, he had just learned about the federal raid at the Mo Money headquarters. He says his company, up2U, is not under investigation.

Miller says he will probably not do business with Mo Money Taxes in the future.

"This has been the biggest mess I have encountered in my business career," he said.

Up2U has processed a total of $70 million in tax refunds for Mo Money customers this tax season.

Miller says, at this point, most people have received their refund.

Stay with WAVY News 10 and WAVY.com for updates on this developing story.