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April 17, 2007 at 11:58 PM
Regulators in 2 states are warning consumers against doing business with an organization that offers to trade what it calls a “tax-deductible installment plan” for a variety of assets.
The Iowa Insurance Division says it plans to issue a cease-and-desist order against the entity, National Foundation of America, Franklin, Tenn., and impose a total of $150,000 in fines and other penalties on National Foundation and an Iowa agent who represented the firm.
National Foundation and the agent have a right to ask for a hearing on the order before it becomes final.
The Florida Department of Insurance has put out a notice stating that National Foundation is not authorized to conduct insurance business in Florida and warning consumers against doing business with it.
Representatives for National Foundation and the Tennessee Department of Commerce and Insurance were not immediately available for comment on the Iowa and Florida actions.
The Tennessee secretary of state Web site shows that National Foundation was incorporated as a nonprofit corporation in Tennessee in January 2006 and filed an annual report April 1.
National Foundation says on its Web site that the installment plan it offers is based on Section 453 of the Internal Revenue Code and can be used to replace annuities, real estate, bonds, securities and cash with an arrangement that can produce “guaranteed income that grows each year” while lowering taxable income by up to 50%.
