The department wants to bar the Orlando, Fla.-based company from owning, operating or franchising a tax business or preparing returns for others. In 2013, LBS operated 239 stores of which 192 were owned by the defendants. These were in Florida, North Carolina, South Carolina, Georgia, Texas, Tennessee, Alabama and Mississippi. The Internal Revenue Service said the amount of lost taxes resulting from the defendants' actions are in the tens of millions of dollars.

The government cited one case in which a customer was waiting for a bus in Tampa, Fla., when an LBS employee offered to drive him to an LBS store to have his return prepared. Although the customer did not have a car, the return preparer at the store reported he had driven 30,256 miles for business purposes, and claimed $17,589 in unreimbursed employee business expense. In a Houston, Texas, case, preparers offset $250,000 won in a lottery in 2012 with $30,141 in bogus charitable contributions and $10,279 in unreimbursed business expenses, resulting in a claimed refund of $8,247.

The defendants, who allegedly targeted low-income customers are also charged what the department called "unconscionable and exorbitant fees."

The LBS players are accused of directing returns to be file that utilize such techniques as falsely claiming the Earned Income Tax Credit; claiming head of household status for married individuals; fabricating business income and expenses; concocting unreimbursed employee business expense.

The seven franchisees and three managers sued are Douglas Mesadieu, Jean R. Demesmin, Kerny Pierre-Louis, Demetrius Scott, Jason Stinson, Wilfrid Antoine, Jacqueline Nunez, Tonya Chambers, Jehoakim Victor and Lauri Rodriguez. In 2014, some of the defendants' LBS Tax Services stores began doing business using the names Milestone Tax Services, Tax Giant, AWA Tax, Tax Master Xpress, BPTS Tax Services and Nation Tax Services