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Friday, May 13, 2011

‘Tax Lady’ Roni Deutch to Close Law Firm, Surrender Law License

Roni DeutchCalifornia tax lawyer Roni Deutch, the self-described "Tax Lady", announced today that she is broke, surrendering her law license, and closing down her law firm that once employed 200 people, on the heels of the California Attorney General's $34 million lawsuit against her alleging that she swindled clients facing IRS problems.

https://taxprof.typepad.com/taxprof_blog/2011/05/tax-lady-roni-deutch.html

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Tracked on May 16, 2011 9:17:51 AM

Comments

I always hate to see attorneys in trouble. Being an attorney is difficult. Running a successful business as an attorney is even more difficult. And in the legal business, being a woman can make it even more difficult. Those issues aside, I think the non-law firm companies that do tax debt work are a much bigger issue.

There are a lot of non-law firm "tax resolution" or "tax negotiation" companies that are basically stealing money from taxpayers. They charge an up-front fee that is earned upon payment, give the taxpayer a long detailed form that is impossible to fill out completely (and require the taxpayer to provide a lot of documents the taxpayer don't have), and then close the case when the taxpayer does not get back to them with the info/docs timely. They then keep the fee. If the taxpayer gets the info/docs to them, then they bilk the taxpayer for more money at the last minute with the threat of dumping the taxpayer at that point. The cost is often much higher than what an attorney would charge for the work. That is the scam, and the non-law firm companies are making millions, if not billions, of dollars off of it.

These non-law firm companies are not regulated by anyone--other than the attorney generals and the civil law system, I suppose. At least the Tax Lady was subject to some ethics rules that would prevent much of this type of conduct without the need for the attorney general and courts to get involved. Even though ethics rules are somewhat weak, I would rather taxpayers go to an attorney such as the Tax Lady who is subject to these rules, than to non-law firm companies who are not. With the Tax Lady, taxpayers would at least benefit from getting legal advice (such as advice on bankruptcy, collections options, etc.), the attorney-client priviledge and client confidentiality, charged reasonable fees for the services rendered, and have an administrative body to complain to and resolve disputes if needed. Absent the Tax Lady, more taxpayers will just go to the non-law firm companies for "help."

Posted by: WWooley | May 13, 2011 4:20:14 PM