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Borrower Beware: First American Tax

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This company is on the NerdWallet Student Loan Watch List. The list flags student-loan businesses and individuals hit by enforcement actions, court judgments or liens, or bad ratings from the Better Business Bureau. Learn more in Who Gets Listed.


First American Tax and its owner were barred from doing business in Illinois and ordered to refund customers, under terms of a 2015 final judgment and consent decree.

The Illinois attorney general sued the company and owner Gustavo Montes in 2014, accusing them of charging upfront fees between $700 and $1,199 to do little more than complete federal loan-consolidation applications that consumers could fill out on their own for free.

The company advertised it would help student-loan borrowers lower their monthly payments, stop their wages from being garnished, provide access to loan-forgiveness programs and improve their credit scores, but it didn’t perform those services, the attorney general alleged.

“Employing high-pressure sales tactics, defendants target financially vulnerable consumers with student loan debt, in Illinois and throughout the United States,” the attorney general alleged.

The company also did business as First American Tax Defense LLC and First American Student Aid.

Enforcement actions: In the court-ordered settlement, First American Tax Defense agreed to never again do business in Illinois. The company agreed to dissolve all contracts with Illinois consumers and pay $40,000 in restitution, under the settlement instituted by a Cook County Circuit Court judge.

Montes, who denied any liability, agreed to settle without further litigation. The judgment only banned his companies in Illinois.

What the company claims to provide: Lowered monthly payments, relief from wage garnishments, loan forgiveness programs and help with preventing tax liens

Based: Delaware company with a principal office in Park Ridge, Illinois.

Management: Gustavo Montes, owner

Source: Illinois attorney general’s office, Illinois courts