Attorney General Ellison secures victory against tax debt settlement company after 12-day trial

Court found company deceived hundreds of Minnesotans knowingly and in bad faith, finding they were ‘essentially tricked into paying millions of dollars in fees to Wall’ and that company ‘inflicted significant injury upon hundreds of Minnesota consumers’

Company will be required to refund consumers, pay penalty and State’s fees and costs; amounts to be determined later

October 14, 2024 (SAINT PAUL) — Minnesota Attorney General Keith Ellison has obtained a court order finding that Virginia-based tax debt settlement company Wall & Associates, Inc. (Wall), along with its owner and CEO, knowingly and in bad faith deceived hundreds of Minnesotans who signed up with the company to resolve their tax debt. The order follows a 12-day trial on Attorney General Ellison’s claims that Wall falsely represented its average settlement and the nature of its business when it claimed to be a local law firm that had a track record of settling client’s tax debt for 10% of what was owed. The State proved at trial that Wall’s claims were designed to convince consumers to hire Wall and pay them large fees—but were objectively false and deceptive. 

The court declared Wall’s conduct illegal and entered an injunction that requires the company to permanently stop their deceptive practices in Minnesota. The court also ordered the defendants to refund fees paid by many harmed Minnesota clients in an amount to be determined at a later date. Finally, the court ordered defendants to pay a civil penalty as well as the State’s attorneys’ fees and costs in pursuing the case.

The court detailed the challenging circumstances of Minnesotans who sought help from Wall, including struggling small business owners and individuals caretaking for family members with major illnesses and injuries.  The court ultimately found that Wall took advantage of clients who were “facing the intimidating task of fending off the IRS . . . by using false and deceptive practices.” 

The court found the consumers who testified to be credible, particularly in comparison to Wall’s salesperson, CEO, and owner. The court found that much of the CEO’s testimony was not credible, that his answers were evasive, unusual, and that he had “great difficulty admitting the obvious.” The court found that Wall’s owner also lacked credibility and that his testimony was often contradicted by the evidence.

For years, Wall stressed to potential clients that it had a proven track record of securing settlements for clients that amounted to a 90% reduction in their tax debt. Many consumers testified this representation was key to their decision to hire Wall. The State showed at trial that, despite Wall’s claims, the vast majority of Minnesotans who hired Wall received no reduction in their tax debt whatsoever. In fact, most of the time Minnesota consumers paid more in fees than they received in tax reduction. The court ultimately found that defendants’ conduct “inflicted significant injury upon hundreds of Minnesota consumers.” 

“Preying on folks facing financial hardship is as low as it gets, which makes Wall & Associates’ deception and conning of Minnesotans looking for help with tax debt all the more disgraceful,” said Attorney General Keith Ellison. “I’m very pleased that after a 12-day trial, the court has recognized the harm Wall & Associates caused Minnesotans and ruled in our favor. As a result of the victory, my Office will be putting back money back in the pockets of Minnesotans and Wall & Associates is prohibited from deceiving consumers in our state. This is what helping Minnesotans afford their lives and live with dignity, safety, and respect looks like.”

In addition to finding the company’s conduct illegal, the court ruled that Wall’s owner, E. Kenneth Wall, and CEO, P. Mark Yates, are personally liable for the company’s misconduct because they were the “masterminds” behind the operation who promoted the settlement rate claims and “schemed to promote Wall as a local company, a law firm, and a tax preparation business—all of which are untrue.” The court wrote: “The record is replete with evidence that Mr. Wall and Yates not only knew about all aspects of Wall’s deceptive conduct, but personally participated in and directed the conduct and profited from it.” The court found that Mr. Wall “profited enormously” from the scheme as he took home at least $67 million between 2010 and 2021.

In imposing a civil penalty on defendants, the court found that defendants acted in bad faith, pointing to numerous examples, including defendants’ refusal to change practices even though it knew its representations were misleading and its decision to stop keeping records of client complaints and stop putting things in writing, which the court called “a striking example of consciousness of guilt.” 

The Attorney General urges the public to be aware of companies that prey on people in tax or consumer debt.  For information about tax debt settlement companies, visit the Office’s online publication titled Tax Relief Scams.  Consumers in Minnesota who believe they are a victim of a scam or were deceived or misled by an unscrupulous company are encouraged to file a report with the Attorney General’s Office using this online form. The Office can also be reached by phone at (651) 296-3353 (Metro area) or (800) 657-3787 (Greater Minnesota).