The Investigators: No "Hope For Tomorrow" - WMC Action News 5 - Memphis, Tennessee

Reported by Andy Wise

The Investigators: No "Hope For Tomorrow"

A state-run career center placed an untold number of job-seekers with an employer who has no funding or capital, but is under a federal court order for fraudulent tax returns.

The Tennessee Department of Labor & Workforce Development has dropped its association with Montrice McGhee of Frayser after several people whom the center placed with her "ministry" complained.

Their complaint:  the "ministry" doesn't exist.

The department's Memphis Area Career Center, 444 N. Main St. (http://www.memphiscareercenter.com/), placed several job-seekers with McGhee's Hope for Tomorrow Ministries.  Pay stubs indicate McGhee put them on the payroll for a little more than a month, training them to eventually work at her ministry's planned homeless shelter on McLemore Ave. in South Memphis.

"I understood I had a job, and I had faith, and it was a worthwhile project," said Kirk Rankin of Midtown Memphis.  Records indicate McGhee employed him May 1 through June 24.  "It was something in my heart of hearts I believed in."

The Action News 5 Investigators discovered McGhee never had a lease on her so-called "headquarters" at 25 Linden downtown.  She also never had a contract on the McLemore Ave. facility she intended for the homeless shelter.

She admitted to Action News 5 she has no funding at all for ANY business or ministry.

"I don't have all the details just yet, but the funding just fell through at the last minute," said McGhee.  She said the funding was supposed to be from "private donors." She would not reveal them.

But she still put several people on a payroll, complete with pay stubs that indicate federal withholding, Social Security taxes, even child support were deducted, but no paychecks were ever issued.

"She's got access to get into my account, my Social Security," said Maya Wallace of Midtown Memphis, another employee.  "I had to have a fraud alert put on my information."

Jeff Hentschel, communications director for the Tennessee Department of Labor & Workforce Development, said it's not the career center's responsibility to screen prospective employers like McGhee.

"We do not screen employers, just like we don't run background checks on the job-seekers who come through our doors," said Hentschel.  "When we started working with (McGhee), initially everything appeared normal. There weren't any red flags."

Actually, there were red flags.

Federal court documents indicate McGhee is under a permanent injunction by the U.S. Justice Department.  The documents show from 2000 to 2004, McGhee ran a tax preparation business.  The documents allege McGhee filed fraudulent claims on tax returns for clients in a dozen states.

The initial complaint filed by the Justice Department says McGhee falsified claims on her clients' returns to the tune of more than $1 million.

Under the penalty of contempt of court, McGhee signed an order issued Feb. 2008, agreeing to turn over a list of the names, addresses, Social Security numbers and other personal information of each of her tax clients within 11 days of the order.

On-camera with Action News 5, McGhee admitted she hasn't turned over the list to federal authorities.

"I haven't complied with that order," she said.  "I mean, I have a list.  I just haven't sent it out yet."

Leigh Anne Jordon, law enforcement coordinator for the U.S. Attorney's Office in Memphis, said the office will monitor Action News 5's story to see if McGhee should be turned over to Justice Department officials.

Hentschel called McGhee an "isolated incident" among thousands of successful referrals by the career center.

"In the last 12 months, the center has had over 490,000 referrals with only three complaints," he said.

"The (center) doesn't have the resources.  They don't have the investigators," says Rankin.  "This woman preyed upon our religious beliefs, and we've got zero!"

 

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