California’s Attorney General believes the highly-publicized tax-debt resolution tactics and track record of attorney Roni Deutch are bogus. According to an AP report, Jerry Brown said Deutch’s Sacramento-based law firm is overstating its ability to resolve large consumer tax debts. He has filed a lawsuit seeking an end to her claims and damages for hundreds of defrauded consumers.
Instead, Deutch’s firm charges high, up-front costs to desperate consumers with a near guarantee they’ll lower the debt owed the Internal Revenue Service.
Deutch is a fixture during daytime television, with ads running regularly through the day. She has also appeared as a tax-debt expert on cable news programs. Her ads prominently feature Deutch touting her firm’s ability to resolve tax debt, and says her lawyers’ expertise is able to reduce tax debt for 99 percent of the company’s customers.
Brown refutes this claim in a lawsuit he filed this week, saying Deutch’s firm has only lowered the tax debt for 10 percent of its customers. Deutch generates about $25 million a year from her tax business, and spends $3 million of that on TV ads.
The AG wants a judge to enact an injunction against Deutch’s firm from advertising the claims it currently makes. The firm collects nearly $5,000 up-front from consumers, but Brown said hundreds of people have filed complaints against the firm with his office.
His lawsuit also seeks $33.9 million in restitution from Deutch’s firm.
A U.S. Bankruptcy judge has ordered Europe’s largest bank to turn over all documents it has related to the business it kept with jailed Ponzi scheme mastermind Bernard Madoff.
According to a Bloomberg report, HSBC Holdings Plc has been ordered to surrender all its reports, contracts, audio recordings and documents it has pertaining to examinations of Madoff’s firm conducted by an affiliate of KPMG International. Europe’s leading banking firm was a custodian bank for several funds invested with Madoff, according to the report.
Judge Burton Lifland’s order stands with the High Court in London, which will be in charge of collecting Lifland’s demands.
HSBC and UBS AG each face billions of dollars in lawsuits from investors who claim the firms failed in their roles as custodians of feeder funds tied to Madoff’s record scheme. Most Euro investors are based in Luxembourg and Ireland.
Celebrities including Jennifer Aniston, Cher, Liv Tyler, Melanie Griffith, Anne Hathaway and Scott Speedman have been named as victims of a serious credit card scam.
According to an affidavit filed in United States District Court, a witness claims the celebrities’ credit card information was stolen by a woman who ran a salon in Beverly Hills called the Chez Gabriela Studio.
Maria Gabriella Perez, owner of the salon, was arrested on federal fraud charges, and is due to appear in court in LA.
Court documents accuse Perez of fraudulently charging approximately $280,000 worth of charges in a one year period, including $214,000 from Liv Tyler alone.
In a third class action against for-profit colleges, shareholders claim the Education Management Corp, its directors and underwriters defrauded investors with false and misleading statements in the prospectus for its Initial Public Offering.
Education Management operated 93 schools in 28 states of the US and Canada, and offers online and campus-based college degrees through its Art Institutes, Argosy University, the Brown Mackie Colleges and South University.
Eight directors, Goldman Sachs, JP Morgan Securities, Merrill Lynch, Barclays Capital, Credit Suisse Securities, and Morgan Stanley, which underwrote the IPO, are also being sued.
The class action seeks damages for securities violations.
Morgan Stanley has lost an arbitration ruling that will allow two brokers convicted of conspiracy, wire fraud and securities fraud to each keep $4.45 million in signing bonuses.
A Financial Industry Regulatory Authority arbitration board denied the New York-based firm’s request to have Eric Butler and Julian Tzolov repay the bonuses paid when they were hired in 2007.
Prosecutors said the men, working at Credit Suisse Group AG before joining Morgan Stanley, falsely told clients their securities were backed by federally guaranteed student loans and were a safe alternative to bank deposits or money-market funds.
The products were actually linked to auction-rate securities and generated high commissions for the pair.
The arbitration board didn’t provide a reason for its decision.
The FTC has announced that it has shut down the activities of Canadian con artists who convinced thousands of US consumer website owners to pay bogus bills.
Toronto-based company Internet Listing Service was charged in June 2008 with sending fake invoices to many small businesses and other website owners in the US.
The invoices would list the existing domain name of their website or a slight variation upon it and would appear to come from the authentic domain name registrar used by the businesses.
The order bars the company’s owners from misrepresenting that they will provide SEO services, that they have a pre-existing relationship with consumers, that they provide domain name registration and importantly, that consumers owe them money for these non-existent services.
Two auto safety advocacy groups petitioned the FTC, which regulates rental car companies, to prevent Enterprise Rent-A-Car from renting out recalled but unrepaired vehicles to customers.
Enterprise Rent-A-Car and its parent company admitted in May that its negligence caused the death of Santa Cruz sisters Raechel and Jacqueline Houck.
A jury awarded their parents of the two girls $15 million in damages in June after hearing the wrongful death lawsuit.
A similar lawsuit against Budget Rent-A-Car was settled in 1991 with a consent agreement, where Budget agreed to inspect and repair the vehicles within 120 days after receiving a recall notice or inform renters of the safety recall and the lack of repairs.
Modesto, California-based Valley Meat Company has issued a recall of approximately one million pounds of ground beef products.
The frozen ground beef patties and bulk ground beef products may be contaminated with E.coli O157:H7.
A total of seven patients to date have reported to have become ill as a result of the recalled product.
These products were distributed to retail outlets and institutional foodservice providers in California, Texas, Oregon, Arizona and internationally.
The Internal Revenue Service says it will stop helping banks make Refund Anticipation Loans to the working poor in America.
When most consumers file their annual income tax returns, they’ll choose to do so at a preparer that offers an “instant refund” for a nominal fee. However, this is not the actual return, just a high-interest loan that could end up costing consumers more than it helped.
Consumers, usually working paycheck-to-paycheck, will often opt for a small portion to be taken from their tax returns in exchange for money in their hands and avoiding a wait on a check from the IRS.
But based on an IRS investigation, it learned that nearly $738 million was skimmed from 8.4 million consumer tax refunds in 2008. This money came from loan penalties and interest rates that range anywhere from 50 to 500 percent.
Prior to this week’s announcement, the IRS had been facilitating these loans by using a “debt indicator” which helps banks partnering with tax preparers to make loans based on the expected return. If a consumer did not receive the return told to them by the tax preparer, it is on-the-hook for the money loaned to them in the form of an “instant return.”
New York’s Attorney General Andrew Cuomo has launched an industry-wide investigation into predatory healthcare lending.
He says some healthcare providers pressure people to use a healthcare credit card, called CareCredit, to finance their doctor expenses.
However, the providers often receive kickbacks from the companies based on how much they charge patients, and some patients are even
charged before a visit or procedure, pushing them into debt.
Cuomo has issued subpoenas to 10 providers that promote CareCredit.