San Francisco, CA – San Francisco District Attorney Brooke Jenkins announced today that her office, together with the District Attorneys of Napa, San Diego, and Sonoma Counties, settled a consumer protection action against Tax Network USA & Partners, Inc. (“Tax Network”), a California-based tax relief company. The case centers on unsolicited mailers sent by Tax Network to taxpayers around the State who were or had been subject to outstanding tax liens. As alleged in the Complaint, the mailers were deceptive because they implied a connection with or approval or endorsement of government agencies, including the local county recorders offices, which Tax Network did not have.

“California consumers should not be subjected to direct mailers or other advertisements that look like they come from the government, when they do not,” said District Attorney Brooke Jenkins. “If you receive an official-looking letter that you were not expecting, examine it carefully to be sure that it actually came from a governmental agency. If it turns out to be an advertisement and not an official communication, please contact my office, which is committed to pursuing cases involving deceptive advertisement.”

California law prohibits so-called government look-alike solicitations. With some exceptions that do not apply here, a private company cannot use a seal, emblem, or other symbol or content that could reasonably be construed as implying a connection with or endorsement of any government, or military or veteran organization, unless the company has express connection with, or approval or endorsement of, that entity, or clearly and conspicuously discloses that it does not.

The Complaint alleges that the mailers violated the law against government look-alike solicitations by, for example: displaying what appeared to be a county seal; conveying warning messages that appeared to come from governmental agencies, such as “Notice of Tax Lien” and “failure to respond may result in further collection actions being taken against the debtor”; and using urgency language such as a judgment has been “filed against you for unpaid taxes,” and “[a] lien has been filed causing this balance to be categorized as seriously delinquent”.

Under the terms of the stipulated judgment, which was filed in Sonoma County Superior Court, Tax Network is prohibited from sending direct mailers that appear to be connected to a governmental agency, or that could imply that the government will take action if someone fails to respond to the mailer, and from including any information about a taxpayer’s outstanding tax lien if its accuracy has not been verified through the exercise of diligence based on publicly available information within four weeks prior to sending the mailer. Without admitting liability, Tax Network agreed to pay a total of $400,000 in civil penalties and investigative costs (or a higher amount if payment is not made in a timely fashion). Tax Network cooperated in the investigation.

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