The Federal Trade Commission (FTC) has taken legal action against American Tax Service (ATS) and its operators, Terrance Selb and Tyler Bennett, for allegedly scamming consumers by falsely impersonating government agencies, including the Internal Revenue Service (IRS). The FTC's complaint highlights that ATS misled consumers with deceptive promises of tax debt relief, claiming they could settle debts for significantly less than owed.

Since at least 2019, ATS has been accused of sending threatening letters that impersonate government entities to solicit calls from consumers. The operators allegedly made false claims about their services, often failing to deliver on promises and refusing refunds to dissatisfied customers. Many consumers reported being misled about the severity of their tax issues, with some being told that the IRS was investigating them.

The FTC's complaint outlines multiple illegal activities by ATS, including impersonating government tax authorities and violating the Telemarketing Sales Rule by making misleading statements during telemarketing calls. The FTC alleges that ATS's actions violated several laws, including the FTC Act and the Gramm-Leach-Bliley Act, while the State of Nevada claims violations of state law as well.

The Commission's vote to file the complaint was unanimous, with a 3-0 decision. The case has been filed in the U.S. District Court for the District of Nevada, targeting ATS and its affiliated entities, as well as the individual defendants, Selb and Bennett.