California ‘Tax Lady’ Roni Deutch Could Face Jail Time

Many have seen the late-night commercials featuring brash, outspoken attorney Roni Deutch. California’s Attorney General Kamala D. Harris plans to continue with the lawsuit, originated by predecessor Attorney General Edmund G. Brown, Jr. In addition, Harris has petitioned the Superior Court to imprison Deutch for contempt of court after she allegedly shredded thousands of documents. The shredded documents were under a court order to be used as evidence in the upcoming lawsuit.

The original lawsuit charged Deutch with heartless acts of swindling and defrauding clients facing severe tax problems and owing large sums to the IRS. Deutch’s advertisements, aired nationally, promised to help debtors with their tax problems and get them on the right track to financial recovery. However, it seems as if Deutch has actually been demanding large, up-front payments from clients and doing little, if anything, to improve their looming tax deficiencies.

The latest contempt charge is described by Harris as the consequence of ‘[serious]violations’ and attacks her credibility as a member of the California bar. Harris’ complaint specifically alleges the following: “Deutch is an officer of this Court and a member of the Bar, which only serves to magnify the seriousness of Deutch’s violations of the Court’s orders. If anyone can be expected to respect and follow this Court’s orders, it should be those licensed to practice as attorneys before the Court. The harm caused by Deutch’s contempt is worthy of the most severe sanction….”

Harris alleges that Deutch participated in a massive law firm “purge” and shred up to 200,000 pages of documents one day after the court ordered Deutch to “take reasonable steps to preserve every document.”

More alarmingly, Deutch was issued an injunction requiring her to return close to $400,000 in up-front client fees. The order required Deutch to return all fees within 60 days and she admittedly has refund requests in excess of 60 days which are yet to be reimbursed.

Harris claims that Deutch uses consumer fraud and high-pressure tactics to retain clients to her $25 million a year law firm. Testimonials used in her advertisements, primarily to be found on late-night cable television, are by individuals claiming that Deutch has helped them reduce their IRS tax amounts by thousands of dollars. In reality, these people still owe the IRS thousands of dollars plus penalties and fees, according to the State’s petition. Harris further alleges that Deutch’s claims of 99% success with the IRS are patently false and misleading as she has helped a mere 10% of clients recover from tax liens and debt.

Ms. Deutch is a member of the California bar since 1991 and attended the Western State University College of Law. Her office employs 15 attorneys and is located in North Highlands, California.