Tax Lady Roni Deutch Sued For $34 Million By California AG

Last week, when we asked for nominations for really horrible TV ads, self-described “Tax Lady” Roni Deutch’s name was mentioned more than a couple times. Adding insult to injury, Roni is now being sued for over $34 million by the California Attorney General over allegations that her heavily advertised tax relief service doesn’t actually live up to its promises.

According to AG Jerry Brown, Deutch’s TV ads claim a 99% success rate in reducing the amount of money her clients pay to the IRS. The suit says that number is a little lower, closer to 10%.

Says Brown:

She promises to significantly reduce their IRS tax debts, but instead preys on their vulnerability, taking large up-front payments but providing little or no help in lowering their tax bills.

The suit says that Deutch’s Sacramento-based firm earns at least $25 million each year and spends $3 million on advertising.

In addition to unspecified civil penalties, the suit seeks $33.9 million in restitution for Deutch clients who have filed complaints alleging they were defrauded when the firm collected a retainer but failed to win tax settlements.

One ad singled out in the suit involves Deutch’s claim that her firm helped three clients save a total of $86,000. But according to Brown, those clients featured in the ad still owe the IRS taxes, penalties and interest.

If this sounds a bit familiar to you, it’s possible you’re thinking of the 2006 lawsuit filed against Deutch by the NYC Dept. of Consumer Affairs. The settlement in that case — $300,000 in fines and restitution — was pocket change compared to the millions the California AG hopes to get.

When asked for comment on the lawsuit, Consumerist’s own Tax Cat said, “Meow,” and then went back to chasing a centipede.

‘Tax lady’ Roni Deutch faces California fraud lawsuit [USA Today]