“Go ahead and hate your neighbor,
Go ahead and cheat a friend.”
-Coven (theme from the movie Billy Jack)
I saw a “pat on the back” news release from the Federal Trade Commission today. The headline said, “FTC Settlement: Tax Relief Scammers Agree to Pay More Than $15 million.”
If you go down a couple of sentences, it notes that the scheme bilked consumers out of $100 million dollars.
Crime does pay.
Making $100 million dollars, with the cost of getting caught at $15 million, is an $85 million dollar profit.
Most business, legitimate or illegitimate, will take an $85 million profit any day of the week.
The seminal book on crime, The Godfather, said, “a lawyer can steal more with his briefcase than 100 men with guns.”
Alexander Seung Hahn, the “leader” of the group American Tax Relief LLC, obviously used some of the $100 million to hire some excellent attorneys as he and American Tax Relief got a sweetheart deal.
In theory, the settlement order imposes a $103 million judgment but, according to the news release, “The judgments will be suspended once the defendants and relief defendants have surrendered assets that total more than $15 million, including cash, a home in Beverly Hills and a condo in Los Angeles, jewelry and gold items, and a 2005 Ferrari.”
In other words, everyone goes away happy as long as Hahn and his people fork over $15 million.
If they had walked into a tax relief center with a gun and robbed it of $85 dollars, not $85 million, they would spend several years in the pokey.
Instead, they have to suffer the indignity of giving up their Ferrari.
To some in Beverly Hills, giving up the house and Ferrari may be the same as breaking rocks, but it doesn’t seem the same to me.
I have never understood two things. One is why no one has cracked down on the “tax relief” people a long time ago. I rarely watch television, but see their nonstop advertisements. The Internal Revenue Service has a program called an “Offer in Compromise” where is it is theoretically possible to have your tax burden reduced, but it is rarely successful.
In 2008, the last year that I have statistics for, the Internal Revenue Service received 48,000 Offers in Compromise and only accepted 11,000.
I suspect very few of the successful offers came via the companies that advertise on television.
If anyone should be doing hard time, it should be the people running “tax relief” and “debt relief” scams. They prey upon the most desperate members of society.
If you are so far behind that you think that someone on the internet or answering an 800 number can help you, you are obviously at the end of your rope.
You are also probably financially disconnected. There are legitimate bankruptcy attorneys who may be able to help. I would rather take a chance walking into a local attorney’s office than paying an unknown “tax relief” specialist with a Ferrari.
Since a lot of poor and desperate people ponied up over $100 million, the tax relief scam business must be a good one.
The other thing that the “settlement” does is to show the ineffectiveness of the Federal Trade Commission. I am not sure why they are still in business.
When Elizabeth Warren and others pushed for and created the Consumer Financial Protection Bureau, the Bureau seemed like a perfect “one stop shop” to go after things like “tax relief scams.” In theory, tax relief scams could be something that the Internal Revenue Service goes after. It also could be something where the Justice Department, state attorney generals, state consumer protection agencies or the Federal Trade Commission might consider it their turf.
I’m hoping that the FTC settlement does not preclude the CFPB or other groups from going after tax relief scams.
Or even worse. The FTC settlement showed that crime can have a big payoff. I just hope it does not encourage others to get into the same line of business.
As Glenn Frey said, “the lure of easy money has a very strong appeal.”
Especially to the tune of an $85 million profit.
Don McNay is the best-selling author of Life Lessons from The Lottery and Wealth Without Wall Street.
“Go ahead and hate your neighbor,
The case of the ghostly neighbor
Wilbur lived in a world of fears. Everything frightened him. The full extent of his courage was to admit that he had none.
Noises in the middle of the night, his own shadow creeping up on him and, most of all, black cats scared the wits out of him.
So, picture his chagrin, one day, when he came home from vacation only to discover that a mausoleum had been erected on property adjacent to his home.
Provisional concealed-carry law passes Senate unanimously
Things are staying busy in Frankfort. Many bills are making their way onto the Senate floor from various committees. This past week several important pieces of legislation were debated and passed.
I am particularly proud of the success we had in advocating for Kentuckians’ Second Amendment rights.
I introduced Senate Bill 106 to allow anyone who has been granted an emergency protective or domestic violence order to receive a provisional CCDW permit from the Kentucky State Police in one business day. In some of these cases, victims need this type of protection as quickly as possible.
50 years makes a world of difference
I wasn’t in Frankfort on March 5, 1964, when Dr. Martin Luther King Jr., Ralph Abernathy, and Jackie Robinson led 10,000 on a march to the state Capitol in support of a public accommodations law.
But a few months later, I stood in front of the “Music Hall,” site of the Glasgow Junior High School located on a street named Liberty, and watched black kids “walk up the hill” of College Street on the first day of integrated schools in Glasgow.
Coal has kept Kentuckians warm this winter
This winter, temperatures across the country dipped to historic lows. Here in our home state of Kentucky, the near-arctic climate caused increased power demand which resulted in an incredible strain on the electric grid and rising energy costs.
Protecting citizens’ data is a no-brainer
Target Corp. is learning the hard way: The price is steep for retailers who don’t protect customers’ sensitive financial information.
Target’s profits fell a whopping 50 percent during its fourth quarter of 2013 as the result of a massive security breach involving as many as 110 million of its customers’ credit- and debit-card accounts, which began the day before Thanksgiving and extended throughout much of the holiday shopping season.
Making plans for spring planting
My brother Keith (Keeter) probably planted peas on one of those warm days last week, and I would not be at all surprised to find out that brother Steve did likewise to try to be the first two fellows in Letcher County to actually be digging the soil in their 2014 gardens.
Keeter’s father-in-law, the late Dock Mitchell, used to get my brother to drive him a 50-mile round trip to get pea seeds and potting soil for early February planting. Dock raised mammoth melting sugar snow peas and sugar snaps around every fence on the place.
Cynicism, optimism both on display in Frankfort
Those who spend little time in Kentucky’s Capitol and who read columns by cynics who cover it should be forgiven their disillusionment about how the people’s business is conducted.
Even Scrooge would enjoy library mystery
Saturday afternoons and evenings are usually down time for Loretta and me.
We simply don’t get out much after we’ve used up the movie gift certificates the kids gave us for Christmas. That means we mostly go to the movies to avoid guilt trips because our kids do work hard for their money.
Funding education is critical for Kentucky and its communities
Kentucky’s latest budget outline makes it clear that our leaders in Frankfort plan to go to great lengths to find more money for education. For communities throughout the commonwealth, this effort to restore funds for our schools is very welcomed news.
Who benefits from ‛AT&T Bill’
Senate Bill 99, the “AT&T Bill,” is a great deal for the telecommunications giants AT&T, Windstream and Cincinnati Bell.
It would allow them to abandon their least profitable customers and service areas as well as public protection obligations. But it is a risky and potentially dangerous bet for Kentuckians. Kentucky House members should turn it down.
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- The case of the ghostly neighbor