For immediate release - Thursday, April 24, 2003
Contact Bob Brammer - 515-281-6699.
H&R Block to Reimburse Certain Customers
Tax preparation firm agrees to reimburse consumers
for "Peace of Mind" guarantee
Attorney General Tom Miller said today that H&R Block Services Inc.
has agreed to establish a fund to reimburse clients who paid for the tax-preparation
company's "Peace of Mind" guarantee in 2001 -- but who may not have known
they were paying for the guarantee. "We believe some consumers didn't
know they were purchasing this optional service," Miller said.
H&R Block's "Peace of Mind" program promised to pay up to $5,000 of any
additional income tax owed due to a tax-preparer's error. State attorneys
general said Block added a fee of $22 for the guarantee and in many cases
failed to first obtain consumers' affirmative acceptance.
Under an agreement between H&R Block and 41 states plus the District of
Columbia, Block is establishing a fund of $1 million to be used for refunds
to eligible consumers who had a tax return prepared in an H&R Block
office in tax season 2001 (for taxes due for the year 2000.)
"The agreement will provide refunds for customers who were charged for the
Peace of Mind guarantee but who don't think they were adequately informed
it was optional," Miller said. "The agreement also requires H&R Block
to avoid this problem in the future."
Block denies that it violated any consumer protection statute and maintains
that it did not deprive its customers of the choice. It says about a fifth
of H&R Block customers purchased the "Peace of Mind" program during
tax season 2001. The states' allegations were limited to that tax season,
and not for tax seasons 2002 and 2003.
Under the terms of the settlement H&R Block will seek a consumer's affirmative
agreement before charging for the guarantee in the future. The company
may not make a representation that it "recommends" purchasing the guarantee
until the customer has been provided the material terms and conditions
of the guarantee.
H&R Block also agreed to reimburse the states for the cost of bringing
the action against the company.
Information for Consumers for Requesting Refunds
Miller suggested several tips for Iowa consumers and advised them to go to
web sites or call a toll-free number. English web site: www.hrblock.com/customer_support/pom.jsp
. Spanish web
number is 866-522-7083. A link to the dedicated site also will be available
through H&R Block's main site, www.hrblock.com.
Consumers can check their tax-preparation bill for the 2001 tax filing season
to see if they paid for the Peace of Mind guarantee. If they don't have
the bill, they could call their tax preparer or go ahead and file a claim
There are three criteria for refund: consumers purchased the Peace of Mind
program between Jan. 1 and Oct. 31, 2001; they have not submitted a claim
and received payment under the program for additional tax; and they were
not informed that Peace of Mind was added for a fee.
The dedicated secure web site has a simple claim-filing form to complete online.
Consumers have until August 22, 2003, to make an application for refund.
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