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H&R Block to Pay $4M for Deceptive Trade Practices

Source: Associated Press

Publication date: 2002-12-12

NEW YORK (AP) - Tax return preparer H&R Block will pay $4 million in a settlement for engaging in deceptive trade practices involving more than 61,000 low-income customers, New York City's commissioner for consumer affairs announced Thursday.

"We've seen the end of H&R Block exploiting poor people," Commissioner Gretchen Dykstra told a news conference.

As part of the settlement, the nation's largest tax preparation firm will offer more than $2.7 million in restitution to 61,700 New York customers, in the form of $35 mail-in rebate coupons that can be used toward tax preparation or redeemed for cash. Of those customers, 17,500 will receive two coupons.

The city sued H&R Block in March, charging the company offered misleading information about loans with high interest rates to customers who could anticipate a tax refund.

Dykstra said her department objected to H&R Block ads that which promised "no faster way to get your money." In fact, Dykstra said, a tax refund can be obtained in as little as 14 days if filed electronically with the Internal Revenue Service.

Denise Sposato, a spokeswoman for Kansas City, Mo.-based H&R Block, said it is retraining receptionists who erred in failing to tell some people about the IRS electronic refund system.

Beyond the restitution coupons, the rest of the settlement money will cover fines and the cost of an independent monitor to oversee H&R Block's advertising and training materials.

The money also will finance a city campaign that informs working people that they may be eligible for a credit on their taxes or cash refunds from the government. H&R Block is offering a similar informational campaign, Sposato said.

The Associated Press News Service
Copyright 2002 by The Associated Press
All Rights Reserved

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