New York AG claims company's form precipitated tax rebate deception

NEW YORK (WABC) -- For years homeowners have been complaining they were confused by a form that came in the mail. Now the New York Attorney General is saying it is deceptive and taxpayers were duped into paying millions in fraudulent fees.

7 On Your Side has been knocking on one door for six years, asking Arie Gal, who calls himself the Star Exemption Advisor, for refunds and to changes these letters he sends to new homebuyers.

Now Gal's no longer behind his door. He's in court facing thousands who accuse him of scamming them into paying him high fees for filing tax exemption paperwork which cost nothing to file on their own.

"I do feel vindicated." Mike Mathis is hoping for restitution after we told him New York Attorney General, Eric Schneiderman, slapped Gal with a hefty lawsuit this week.

He sued the businessman for $1.5 million alleging he "tricked homeowners," "substantially overcharging" them with fees to file their Star Exemption forms by "misleading mailers" identical to the forms sent out by Nassau County.

Mike says he filed his own forms, yet Gal sued him for the fee claiming he did it and won.

"We paid him $1,200 and court fees," Mike said.

"It is manipulating. It is illegal and it's certainly a scam," said Christina Bedell, Assistant Attorney General. Bedell handled the case against Arie Gal, and says she got an earful from Star Exemption Advisor victims including those 7 On Your Side has been featuring in stories going back to 2011.

"Our office was aware of consumer complaints which prompted the investigation into his company and business practices," Bedell said.

Back in 2014, Kevin and Tracy Perkins were among those who say they were deceived, billed $1,200 by Gal, the entire first year of taxes they were supposed to save. It's part of a burden the young homeowners couldn't handle. They wound up losing their Levittown home and life savings.

In 2014, we got half their money back from Gal. They're hoping for the rest and along with other plaintiffs, are grateful Arie Gals been restrained from doing business for now.

Arie Gal's attorney said Star Exemption Advisor is innocent of all accusations and never filed for homeowners who were not his clients. And Gal also did not design his mailing to look like the governments.

Gal and his attorney will be back in court on Monday. In the meantime, his assets have been frozen. Anyone who believes they've been victimized should contact the Attorney General's office in Nassau County or file a complaint online.

For more information please visit: https://ag.ny.gov/nassau-regional-office