At the Federal Trade Commission’s request, a federal court has temporarily halted alleged tax debt relief scammers from falsely impersonating government agencies, including the Internal Revenue Service, deceptively promising tax debt relief, sending threats to consumers about their debts and pocketing tens of millions of consumers’ dollars.

The FTC filed a complaint against American Tax Service (ATS) and its operators, Terrance Selb and Tyler Bennett, as well as seven affiliated entities. The Commission alleges the company’s operators falsely claimed they could settle taxpayers’ back taxes for “pennies on the dollar” or for only a “fraction” of what taxpayers’ owed, often making these claims before evaluating the taxpayer’s circumstances.

“People trying to pay down their tax debt shouldn’t have to worry about fraudsters pocketing their hard-earned money,” said Christopher Mufarrige, FTC’s Bureau of Consumer Protection Director. “The FTC will not hesitate to act to stop companies like ATS that target hard-working Americans with bogus debt relief services.”

Since at least 2019 ATS, Selb and Bennett have misled consumers by mailing deceptive and threatening letters that impersonate the government to solicit inbound telemarketing calls. ATS’s operators also made false claims about their tax debt relief services and failed to fulfill their promises, such as refusing to provide refunds to dissatisfied consumers who requested one.

The complaint alleges that ATS sales representatives misled consumers about the severity of their tax debt issues to scare them into paying for ATS’s tax debt relief services with some consumers saying that ATS operators falsely claimed that the IRS was investigating them or that the IRS “red flagged” their account or marked it as “high risk.” Once consumers agree to pay for ATS’s services, the operators of the scheme did little, if any, of the promised work and rarely, if ever, obtained the promised results.

The ATS operators contacted consumers through telemarketing calls or in response to inbound calls resulting from direct mail and online ads. The FTC alleges the defendants engaged in multiple illegal activities, including:

• impersonating the government including local, state, or federal tax authorities;
• making false promises that they could reduce consumers’ tax debt; and
• violating the FTC’s Telemarketing Sales Rule requirements by making misrepresentations in telemarketing calls.

The FTC alleges that ATS’s conduct violated the FTC Act, Gramm-Leach-Bliley Act, the Telemarketing Sales Rule and the Impersonation Rule. The State of Nevada alleges that ATS’s conduct also violated Nevada law.

The Commission vote approving the filing of the complaint was 3-0. The FTC filed the complaint in the U.S. District Court for the District of Nevada against American Tax Service LLC, American Tax Solutions, American Tax Solutions LLC, ATS Tax Group LLC, Elite Sales Solutions, GetATaxLawyer.com LLC, TNT Holdings Group LLC, TNT Services Group LLC, TNT Tax Associates Inc., and individual defendants Selb and Bennett.

The staff attorneys on this matter are Simon Barth and James Evans in the FTC’s Bureau of Consumer Protection.