HSBC Watch News Release Forum Index
Forum Name: - Social Responsibility
Topic Title: Walmart's Link to RICO and Predatory Lending
Tue Dec 14, 2004 10:24 am
Shoppers may have noticed tax preparation kiosks in Walmart stores. You will see them again soon as Walmart and H&R Block have joined forces to increase profitability. H&R Block's RAC's and RAL's, the popular but costly refund anticipation loans, are backed by predatory lender Household International. Household, now a wholly owned subsidiary of HSBC, claims to have invented the process.
With H&R Block the subject of RICO charges relating to their scheme with Household, Walmart is certain to cash your refund check. Opponents state that the federal government is not a collection agent for Household International, which takes past due and charged off account balances out of the refund amount before the customer gets the check, but the customer has already signed and agreed to the terms. The IRS has looked at Block's rapid refund program as a source of abuse, referencing abuse of the earned income credit and the number of children claimed on tax forms.
It appears that the law requiring social security numbers for newborns does not hamper attempts to use Block as a means to defraud the system. Block's customer simply says that last year's baby died, and this year's is a newborn and the paperwork has yet to be processed. The vulnerability of Walmart in enabling this highly controversial program through Walmart stores remains to be seen.
Fri Mar 25, 2005 10:21 am
When you file with H&R Block, the information goes to Household. The rapid refund checks are a loan from Household Bank. A list is given to Household / Beneficial collections employees. The information gives your name, telephone number, address, name and phone number of your employer.
When you apply for a Best Buy Card, buy furniture, or finance a motorcycle the same holds true.
The information sharing is legal between a company's subsidiaries and affiliates. It tells us when you expect your refund and how much it will be. The collectors are not allowed to tell the customer we have this information. Even though we already have all your information, we are supposed to word it as "When do you expect your refund to come?".
When you have an account with Household, Household is allowed to pull a new credit bureau report (CBR) once a month. The credit report also provides updated information. Other databases are used to cross reference, verify, and update information. Household uses information from credit applications, rapid refunds from H&R Block, CBRs, and external sources to update customer information.
When you try to pay online and cannot access the website you must find a way to pay your bill on time. Most people turn to paying by telephone. Cha-Ching - $15. Since we pull your credit report every month we can see your payment history. If all of your creditors report you as "never late" except for us, we assume you were Shea'd or a winner in one of our employee contests. Cha-Ching - $39. Winner for them, loser for you. If you call and yell or get mad at the CSR's just remember, they see part or all of this information too. If you are really ignorant your mailing address might accidently change. Cha-Ching - $More Money.
We monitor customer trends for possible violations of Regulation Z and other possible illegal actions.