Ghost preparers prepare the tax return, but when it's submitted to the IRS, they ask the taxpayer to sign their own return, making it look like it was self-filed.
According to the IRS, “The ghost preparer can print the paper return for their client and tell them to sign and mail it to the IRS. Or, for electronically filed returns, they will prepare it but won’t digitally sign it as the paid preparer.”
This doesn't seem like a big deal, until something goes wrong, and the preparer is nowhere to be found. Since the return is technically self-filed, the taxpayer is liable for any errors or omissions the ghost preparer made, including underpayment and negligence penalties, which often happens because the large refund promised was not accurate in the first place.