TRAVIS COUNTY, Texas—A Travis County jury has assessed the tax-resolution company TaxMasters with a whopping $195 million penalty for deceiving consumers who sought its help.
The judgment Friday followed a trial in which the Texas Attorney General accused the company of violating the deceptive trade practices act.
Jurors heard testimony from consumers, as well as recorded sales calls in which the AG claimed TaxMasters defrauded consumers.
The jury began deliberating Thursday after hearing a week of testimony.
Jurors ordered TaxMasters to pay $121,143,078. Its holding company, TMIRS, was penalized with a judgment of over $27 million, and the head of TaxMasters, Patrick Cox, was slapped with a judgment of over $46 million.
Among the state’s claims:
*That the company didn’t disclose to customers that payments were non-refundable.
*That the company didn’t disclose cancellation fees to its clients.
KHOU-TV recently reported that even after the AG filed suit against the company in May 2010, TaxMasters complaints continued to come in to the AG’s office and the Houston Better Business Bureau.
Not long after our report, the company announced it was filing for bankruptcy claiming it had less than $50,000 in assets and nearly 5,000 creditors that it owed between as much as $10 million.