"Tax Lady" Closes Office

"Tax Lady" Roni Deutch has announced that because of the CA Attorney General's office charges of fraud she is closing her office. Long a fixture on late night TV commercials, Ms. Deutch promised to help clients with large tax debts settle with the IRS and state agencies for "pennies on the dollar." Last year, the AG's office charged her with a $34 million dollar restitution judgement for taking client's money and not doing what she promised. It turns out that she only helped about 10% of her clients. Recently, she was back in the news because the CA Attorney General contends that she ignored the judgement. She had continued business as before and was not making restitution. This time the judge put her business in receivership and set a hearing for June on contempt charges. In a press conference, Ms. Deutch stated that her business was off 90% because of the actions and that she is forced to close her office and she will be surrendering her law license.

I've written about these "pennies on the dollar" schemes before. They pray on taxpayers with a big tax bill with a promise to get the tax authority to accept a much lower payment. The problem is they charge a large up front fee and do very little. In some cases, they do nothing. Most good tax professionals can help more and at a lower fee.

But back to Ms. Deutch, one thing that doesn't add up for me. Why is she giving up her law license? In her press conference, she counters the AG's charges saying that the CA Bar has reviewed over 300 cases and never even reprimanded her. So the Bar Association isn't going after her and she still has the hearing on contempt charges but she gives up her license. It makes me wonder what hasn't been made public.

A quick addition. It seems Ms. Deutch may have mis-spoke when she said she had not been reprimanded by the CA Bar Association. It looks like she forgot the word "yet." According the Tax Prof Blog, the Bar Association confirms that they have opened  disciplinary proceedings against the Tax Lady. Please check out the whole article here.

Roni Deutch, American Debt Relief, J.K. Harris and Tax Masters have all spent millions to publicized they tax debt relief services and are in trouble with a variety of Federal and state agencies for mis-leading advertising and fraud. So, hopefully, the word is getting out that there is no easy fix to tax debt.

 

Comments

[Brian O'Connell]

If it seems too good to be true, it probably IS too good to be true. And therefore, it's probably not true. How many times do we hear in the news that someone fell for a scheme where they were promised something that seemed totally unreasonable, but was advertised that it was legitimate? I often get messages about reducing home mortgage or my college loan. I tear them up because I know they want to charge a ton of interest so that they can make my monthly payments lower. Sounds good, but in the end i owe a ton more money. Always ask questions and make sure you know every detail about something you are going to put a big investment into.

[mike]

As I read this, I notice that the ads on the side of the page are for such services...