A tipster (send in your tips here) has been sending me information on the Tax Defense Network at taxdefensenetwork.com.
The company is located at:
Tax Defense Network, Inc.
13901 Sutton Park Drive, South
Jacksonville, Florida 32224
The point the tipster (send in your tips here) brought to my attention was that the listed owners of the Tax Defense Network are listed as:
Title PD (President, Director)
13901 SUTTON PARK DR, SOUTH, BLVD A, S-220
JACKSONVILLE FL 32224 US
Title VD (Vice President, Director)
13901 SUTTON PARK DR, SOUTH, BLVD A, S-220
JACKSONVILLE FL 32224 US – Source
The company first incorporated in 1997 as New Start Credit Services. The Valinhos bought it in 2007, adopting the Tax Defense Network name and a new strategy to grow the company nationally.
The company now conducts 4,000 new client consultations per month with people across the country, many of whom become clients. In fact, Tax Defense Network boasts an average annual revenue growth of 289.66 percent from 2007 to 2009 and is No. 8 among 10 companies being honored for top dollar-volume revenue growth.
The company has grown so fast it has moved four times in three years. It will double its space when the company moves again to a new, 24,000-square-foot office at the end of the year. – Source
The interesting fact the tipster (send in your tips here) wanted people to know is that the Valinho brothers stumbled into hot water with the State of Florida over their past debt settlement business, Emergency Debt Relief, Inc.
In 2006, Joseph Valinho and Franklin Valinho entered into an agreement with Florida in which they and their company paid $230,000 to “compensate affected consumers.” They also paid an additional $60,000 in civil penalties.
The official press release on this matter said:
TALLAHASSEE – Attorney General Charlie Crist today announced that his office has reached a settlement with a debt relief company that calls for the business to provide $230,000 to reimburse consumers who paid fees to the company but failed to gain debt relief. The agreement resolves consumer complaints about the business practices of Emergency Debt Relief, Inc., formerly of Jacksonville, and requires the company to revise its business practices.
Emergency Debt Relief (EDR) claimed it could reduce consumers’ payments to creditors by up to 50 percent. The company also claimed it could settle the average consumer’s debts for 35 to 45 percent of the original amount owed, and could help consumers become debt-free in as little as 12 months. However, EDR charged a high monthly fee – equivalent to 18 percent of the consumer’s total indebtedness – and failed to negotiate the debt even after receiving large fee payments from consumers.
“Those who are deep in debt need a helping hand, not a shovel to dig deeper,” said Crist. “This settlement will bring them some relief.”
Crist’s office began investigating EDR in March 2005 after receiving complaints from consumers who claimed they paid the company’s fee, which ranged from several hundred to several thousand dollars, but then received no service. The consumers said that even after they paid for EDR’s debt relief services, they continued to receive harassing phone calls from creditors and their credit rating continued to suffer. More than 45 complaints against EDR were filed with Crist’s office.
Under the agreement, EDR along with its former owners, Franklin and Joseph Valinho, will provide $115,000 to reimburse consumers who have already filed complaints and will create a separate $115,000 reimbursement fund for affected consumers who might file complaints later. In addition to reimbursing consumers, the company must revise its business practices to better serve consumers. The company formerly operated in Jacksonville, but was sold last year and relocated to Pennsylvania. – Source
The Assurance of Voluntary Compliance document the state lists says:
The Office of the Attorney General, Department of Legal Affairs, State of Florida (“the Attorney General”), investigated the business practices of EMERGENCY DEBT RELIEF and its current officers, directors, and employees (hereinafter referred to as “EDR”), along with FRANKLIN VALINHO and JOSEPH VALINHO, individually and as former officers and directors of EMERGENCY DEBT RELIEF, INC. (hereinafter referred to as “VALINHOS”), pursuant to the Florida Deceptive and Unfair Trade Practices Act, Chapter 501, Florida Statutes.
This Assurance of Voluntary Compliance, (hereinafter referred to as “AVC”), is solely intended to resolve the investigation into whether Emergency Debt Relief, including its former and current officers, directors, and employees, engaged in any unlawful and deceptive trade practices.
The Attorney General, by the signature of his Deputy Attorney General, affixed hereto, does in this matter accept this AVC in termination of this investigation, pursuant to Section 501.207(6), Florida Statutes, and by virtue of the authority in the Office of the Attorney General by said statute. – Source
It also appears that the Tax Defense Network is bound by the provisions of the Assurance of Voluntary Compliance agreement with the state as well. It says:
- EMERGENCY DEBT RELIEF, INC., shall not effect any change in the form of doing business or organizational identity as a method of avoiding the terms and conditions set forth in this Assurance of Voluntary Compliance. This provision should not be construed to prevent EMERGENCY DEBT RELIEF, INC., from changing its form of doing business so long as any successor or alternate company created by the principals of EMERGENCY DEBT RELIEF, INC. are bound by the provisions of this agreement.
- The VALINHOS, shall not effect any change in the form of doing business or organizational identity as a method of avoiding the terms and conditions set forth in this Assurance of Voluntary Compliance. This provision should not be construed to prevent the VALINHOS, from changing their form of doing business so long as any successor or alternate company created by the VALINHOS are bound by the provisions of this agreement. – Source
Here is what I find to be odd.
Tax Defense Network began life as New Start Credit Services, Inc. with a board of directors that consisted of Fonda Munteanu, Alex Munteanu, and Leon Zucker- Source
It did not file annual reports 2001, 2002, or 2003 under the direction of Munteanu’s. New Start Credit Services then does not file annual returns in 2005 or 2006.
The year following the problems with Emergency Debt Relief, the Valinho’s take over New Start Credit Services, Inc. On April 18, 2007 the corporation was reinstated with Joseph Valinho and Franklin Valinho now the directors of the company. – Source
On April 25, 2007 they change the name to Tax Defense Network, Inc. – Source
What makes all of that interesting is Tax Defense Network brags about their A BBB rating, which has now slipped to an A- actually. What I find interesting is the BBB says the company started in 1997, when in fact it did not emerge as Tax Defense Network until 2007. Okay, technically New Start Credit Services did start in 1997 and the Valinho’s picked it up in 2007 but it appears it was not in continuous operation nor offered similar services.
On the Tax Defense Network site it states the “Original Business Start Date as 1997.
The “Original Business Start Date” seems to be a play on words since the BBB actually reports it as: “Business started: November 1997.”
Since the company has revived itself it now has 28 complaints, with almost half of those coming in the last 14 months. – Source
Maybe Tax Defense Network has brought forward an environment that has revised its business practices to better serve consumers. But if so, what’s up with the misdirection on the formation date and current consumer complaints?
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