Federal and state regulators are moving in on American Tax Service, saying a proposed settlement will strip the company’s leaders of millions in cash and assets and lock them out of the tax-relief business. Authorities say the operators targeted people already buried in tax debt, impersonated government agencies, and used scare tactics to collect fees for help that regulators say never really arrived. The goal now is to get that money back into the pockets of the consumers who paid it.
According to the Federal Trade Commission, a proposed order filed June 2 in U.S. District Court in Nevada would require operators Terrance Selb and Tyler Bennett to hand over more than $8 million in cash plus additional assets, all earmarked for consumers the agency says were harmed. The agreement also includes a $77.7 million judgment, a number regulators say reflects what the defendants took from consumers between February 2022 and 2025. Most of that judgment is currently suspended because of what regulators describe as the defendants’ inability to pay.
In a post on X from the official account of the Nevada Attorney General, Aaron Ford said, “Consumers who are struggling with tax debt deserve honest information and legitimate assistance, not false promises and scare tactics.” His office says the money and property surrendered under the deal are intended to help make customers whole.
What the settlement requires
Under the proposed terms, Selb and Bennett would be permanently barred from advertising or providing debt-relief products, from most outbound telemarketing, from preparing taxes, and from posing as government agencies, as reported by KOLO. Regulators say those specific bans are designed to keep the pair from returning to the same lines of work they allegedly used to target consumers in the first place.
How regulators say the scheme worked
According to regulators and court filings, American Tax Service and related entities allegedly pretended to be the IRS and state tax authorities, sent intimidating letters and made aggressive calls, and pitched settlements of back taxes for “pennies on the dollar” before they even checked whether people qualified. That description first appeared in an enforcement complaint filed last year, as detailed by Lexology.
Legal consequences and next steps
The proposed order landed in the U.S. District Court for the District of Nevada after the Commission voted to approve the action, and litigation is still underway against corporate defendants, according to the Federal Trade Commission. If the judge signs off, the cash and assets will be used to reimburse victims. The suspended $77.7 million judgment could also spring back in full if the defendants are later found to have misrepresented their finances.
Where to report and how victims are being helped
Anyone who thinks they paid for services from American Tax Service or a similar operation can file a complaint with the Nevada Attorney General’s Bureau of Consumer Protection through the Nevada Attorney General. Officials at both the state and federal level say the seized funds are intended to be returned to affected consumers as the case works its way through court.
