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H&R Block Charged With Fraud

danarhea

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The Attorney General of New York has charged H&R Block for defrauding thousands of its clients out of retirement savings by fraudulently marketing retirement savings plans. H&R Block did not have the decency to disclose that its fees were higher than any interest these accounts could earn. The fact that it was primarily low-income clients this predatory scam was being perpetrated on makes this even worse.

New York is seeking 250 million in fines, plus refunds to everyone they bilked.

The best way to defend against these kinds of unscrupulous practices is just to stick your money in the bank. Hell, just stuff your money in an old mattress and you will come out ahead, compared to what H&R Block was marketing.

Sick and greedy times bring out the worst in sick and greedy people, who would sell their own mothers' souls for a buck.

Article is here.
 

RightinNYC

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danarhea said:
The Attorney General of New York has charged H&R Block for defrauding thousands of its clients out of retirement savings by fraudulently marketing retirement savings plans. H&R Block did not have the decency to disclose that its fees were higher than any interest these accounts could earn. The fact that it was primarily low-income clients this predatory scam was being perpetrated on makes this even worse.

New York is seeking 250 million in fines, plus refunds to everyone they bilked.

The best way to defend against these kinds of unscrupulous practices is just to stick your money in the bank. Hell, just stuff your money in an old mattress and you will come out ahead, compared to what H&R Block was marketing.

Sick and greedy times bring out the worst in sick and greedy people, who would sell their own mothers' souls for a buck.

Article is here.

You're presuming H&R Block is actually guilty, and that this isn't just a cheap political ploy by Eliot Spitzer. Which is a damn big assumption.
 

danarhea

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RightatNYU said:
You're presuming H&R Block is actually guilty, and that this isn't just a cheap political ploy by Eliot Spitzer. Which is a damn big assumption.

When the evidence already shows that people who started these accounts have less money in them a couple of years later, and that H&R Block never disclosed its exhorbitant fees, then it is evident that Spitzer is doing his job.
 
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RightatNYU said:
You're presuming H&R Block is actually guilty
Exactly what I was thinking. I'm guessing that if Dana were called to the jury pool, he'd never make it out of Voir Dire.
 

RightinNYC

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danarhea said:
When the evidence already shows that people who started these accounts have less money in them a couple of years later, and that H&R Block never disclosed its exhorbitant fees, then it is evident that Spitzer is doing his job.

If I go to my bank, Washington Mutual right now, and open a checking account with all sorts of features, there are requirements. I have to maintain a minimum balance, can only do a certain number of transactions for each time period, have to pay a yearly fee. WaMu has the right to change those fees at any time (as is stated when you sign up). It's quite possible to end up with less than I started with. Does that make them criminal? No.

The charge here isn't that what happened was illegal, but that it was dishonestly presented. Which is not clear cut at all.
 

danarhea

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RightatNYU said:
If I go to my bank, Washington Mutual right now, and open a checking account with all sorts of features, there are requirements. I have to maintain a minimum balance, can only do a certain number of transactions for each time period, have to pay a yearly fee. WaMu has the right to change those fees at any time (as is stated when you sign up). It's quite possible to end up with less than I started with. Does that make them criminal? No.

The charge here isn't that what happened was illegal, but that it was dishonestly presented. Which is not clear cut at all.

When they promise their clients that their funds will grow, while reality shows that those funds actually shrink, it is very clear cut.
 

RightinNYC

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danarhea said:
When they promise their clients that their funds will grow, while reality shows that those funds actually shrink, it is very clear cut.


Wanna show me where it says that?

Fees included a $15 setup fee, a $15 recontribution fee, a low interest rate and a $10 annual maintenance fee. More than 150,000 H&R Block customers closed their Express IRA accounts, only to incur additional undisclosed fees, as well as nearly $6 million in tax penalties, Spitzer said.

H&R Block said it received Spitzer's notice of intent to sue last month, followed by a settlement demand letter.

"We have cooperated fully and provided volumes of data and detailed analyses to the Attorney General's office, but it has ignored all of the positives and has chosen to launch this attack," said H&R Block General Counsel Nick Spaeth.

H&R Block said that between 2001 and 2005, three-quarters of its Express IRA customers experienced "positive net tax savings benefits and interest earnings." An attorney for H&R Block also said the company has lost money operating the program.
 

danarhea

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RightatNYU said:
Wanna show me where it says that?

Says it right here:
The suit seeks $250 million in fines plus refunds after H&R Block steered roughly 500,000 tax return customers to invest in individual retirement accounts, but failed to disclose high hidden fees that actually outpaced interest earned on the accounts, the attorney general said.

As for the part you posted, that is what H&R Block is claiming. That is the same as Ken Lay saying that Enron was solvent. I tend to look at the acutal victims of the scam for evidence.
 

RightinNYC

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danarhea said:
Says it right here:


As for the part you posted, that is what H&R Block is claiming. That is the same as Ken Lay saying that Enron was solvent. I tend to look at the acutal victims of the scam for evidence.

And that's what Eliot Spitzer claims. No evidence whatsoever it's true. In fact, according to H&R Block, the exact opposite is true.

So its innocent until proven guilty for you, except for big business?

And what I was originally referring to was your claim that they "promised that accounts would grow." I'm willing to bet that that's not the case and that in the forms you sign, there's a specific statement that there is no guarantee of earnings.

I'm of the belief that if someone willingly enters into a contract, then they don't really have the right to sue if the contract is not broken.
 
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