California Sues H&R Block over Refund Loans, Claims Deceptive Collection Practices

By Gene Meyer, The Kansas City Star

California’s attorney general sued H&R Block Inc. on Wednesday, alleging that the Kansas City firm’s marketing of income tax refund anticipation loans violates California and federal laws.

Block said it believes the allegations have no legal or factual merit.

California Attorney General Bill Lockyer filed a suit in a state court in San Francisco alleging that Block and participating lenders ? who provide the funds borrowers receive ? deceive Block clients by failing to disclose the true costs and other terms of the loans. The complaint seeks restitution of what it alleges are “tens of millions of dollars” California consumers have overpaid because of alleged deceptive marketing and other practices.

Unlike other refund loan suits filed by individuals and classes against Block, the California suit also alleges that Block is engaging in deceptive debt-collection practices by not telling clients that any unpaid refund fees from previous years may be deducted from their loans along with the current fees.

For this complete story, please visit Block’s refund loan plan under fire.