Scam Nassau Tax Company To Pay Back Victims

A scam tax exemption business based in Nassau County will have to replay everyone that it scammed, coughing up nearly $1 million in a settlement that was announced by New York Attorney General Letitia James on Thursday.

STAR Exemption Advisor, YCA Corp. and its owner, East Meadow resident Arie Gal were found by a court to have scammed thousands of homeowners out of at least $1.562 million by sending out mailers that seemed like official government documents and charging homeowners to file STAR tax exemption applications on their behalf, which can be filed for free. He was first found guilty last January.

James announced a settlement Thursday in which Gal will pay $920,000 in damages, have his company dissolved, have all of his outstanding accounts canceled and be permanently barred from offering any property tax rebate service in the state. He will also vacate all of his small claims court judgments.

“Taking advantage of New Yorkers by manipulating a tax exemption program created to help homeowners is illegal and immoral,” said James. “We should be doing all we can to support homeowners, not prey upon them and steal their hard-earned savings. This settlement is a continued reminder that my office will pursue any individual who tries to deceive New Yorkers.”

The New York State School Tax Relief (STAR) Program provides a partial exemption from school property taxes for primary residences that are owner-occupied with a total household income of $500,000 or less. To receive the exemption, new homeowners must file an application with their local assessor's office by Jan. 2 each year in order for the exemption to be applied to the upcoming and subsequent years' tax bills. Filing the paperwork is free.

The investigation into Gal and his business began after the Attorney General's office received numerous complaints form homeowners about being overcharged for filing the application, which the homeowners had completed. Many of the homeowners were unaware they were sending the forms to a private company. The forms looked like government documents, and homeowners believed they were sending their paperwork to Nassau County.

James said that Gal used the official-sounding name "Star Exemption Adviser" to scam homeowners. The company sent misleading mailers that looked like government documents. The mailers tricked homeowners into signing up with the company to apply for the Basic STAR exemption and being charged for it. The company charged homeowners a fee equal to all of their tax savings for the first year.

If homeowners didn't pay up immediately, or if they disputed the charges, Gal sued them in Small Claims Court. He even sued homeowners for applications they had filed themselves with the Department of Assessment. After receiving the Small Claims Court notice from Gal, most homeowners settled to avoid litigation. Homeowners who went to their scheduled court date were shocked to see so many other homeowners in the same predicament.