Talk about a tax burden.
The founder of a nationwide tax preparation chain has been sentenced to a year and a day in prison for running a tax refund advance scheme that fleeced customers with $70 million in excessive fees.
Fesum Ogbazion, of Cincinnati, Ohio, had been accused of drawing in customers to Instant Tax Service, his chain of 1,100 tax preparation offices across the country, with ads offering loans ahead of their expected tax refunds.
Federal prosecutors said Dayton-based Instant Tax Service (ITS) advertised the loans as being backed by third-party lenders, despite having no partnerships with any financial institution. Instead of paying advances, prosecutors say the business used customers’ financial details from their loan applications to file tax returns, often without their approval or knowledge. The firm would then collect high fees for the work.
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