Silver Spring, MD (April 11, 2008) - Comptroller Peter Franchot today joined with state lawmakers, consumer protection advocates and tax advocacy groups to urge Governor Martin O'Malley to sign the Maryland Individual Tax Preparers Act, legislation to protect consumers against shady tax preparers and predatory lenders. The bill, passed by the General Assembly on Monday, creates a State Board of Individual Tax Preparers that would help protect taxpayers against unscrupulous tax preparers and allow the State to track problem preparers.

"This pro-consumer measure helps protect taxpayers against unscrupulous tax preparers and gives the State a method of tracking problem preparers," said Comptroller Franchot. "We've seen first-hand here in Maryland the kind of fraudulent and predatory practices these firms engage in and it's time to put an end to it."

The event took place in front of a tax preparation business whose co-owner, Lawrence Sperling, was recently indicted by a federal grand jury on charges that he filed tax returns that inflated taxpayers' credits and deductions. This bill would help prevent just such occurrences from happening in Maryland.

"Protecting Marylanders from fraudulent service providers is a top priority for the General Assembly," said State Senator Michael Lenett. "Too many hard working families have suffered from putting their trust in the hands of people who are only interested in making a profit. This legislation will help ensure that people get honest and competent tax preparation services no matter when they live in the state."

Also today, the Comptroller released a letter he has sent to the Governor urging him to sign the bill. The Maryland Tax Preparers Act was introduced in the Senate as Senate Bill 817 by Sen. Joan Carter Conway and passed unanimously. The house effort was led by Del. Carolyn Krysiak and passed by a 112-27 vote. The Comptroller's Office played an active role in crafting the bill and advocating for it. The bill also has the support of the Maryland Association of Certified Public Accountants, the Maryland Enrolled Agents, the Maryland CASH Campaign and the Maryland Society of Public Accountants.

"The Comptroller and the General Assembly have shown tremendous leadership to protect taxpayers and responsible businesses," said Robin McKinney Executive Director of the Maryland CASH Campaign. "Taxpayers can now be assured that their tax preparer will be held accountable."

While Maryland tax attorneys, CPA's and enrolled agents who prepare tax returns are licensed, there are many people advertising themselves as tax preparers who are not. Under current Maryland law, anyone can call themselves a tax preparer - whether they are qualified or not - and in many cases, they are definitely not qualified. The result is thousands of taxpayers being hit with high fees and faulty returns being left alone to navigate the confusing and intimidating landscape of tax law. They are sold financial products, such as Refund Anticipation Loans, based on their falsely inflated refunds and are stuck further in debt and forced to pay exorbitant interest rates and fees.

"Consumers seeking assistance in filing tax returns should not be subjected to deceptive advertisements, despicable loan products, and incompetent service," said Eric Friedman, Director of Montgomery County's Office of Consumer Protection. "We applaud Comptroller Franchot in his efforts to champion consumer protection initiatives and we look forward to working with state regulators in helping our most vulnerable consumers."

The regulatory board this bill creates will provide a mechanism for ensuring that individuals holding themselves out as tax preparers have the requisite knowledge to prepare a basic tax return. This includes making sure that taxpayers are taking advantage of credit programs that can reduce their overall tax burden, such as the Earned Income Tax Credit. Senate Bill 817 also increases the accountability of tax preparers because it requires them to sign each return they prepare, thus holding them responsible for their work. Additionally, the bill provides a framework for investigating and reporting fraudulent tax preparers.

"Marylanders deserve the highest quality tax preparation services possible and they deserve to be protected from fraudulent prepares who seek only to enrich themselves at the expense of working families," continued the Comptroller. "This bill makes it clear that Maryland will no longer allow this kind of deceitful business practice, and I urge the Governor to sign the Maryland Tax Preparers Act into law."

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Contact: Joe Shapiro, 410-260-7305, office, 443-871-2244, cell