Block and HSBC try to settle tax suit
KANSAS CITY, Mo. - H&R Block Inc. has tentatively agreed to settle a class-action lawsuit over its tax-refund loans for $360 million. The nation’s largest tax preparer and its banking partner, HSBC Taxpayer Financial Services Inc., were accused of gouging customers by providing “refund anticipation loans” at interest rates frequently exceeding 100 percent. HSBC bought troubled and disgraced predatory lender Household International in 2002. This is another lawsuit for HSBC caused by Household’s predatory lending. Analysts expect more suits to follow.
The settlement _ for $110 million cash and $250 million in coupons _ would go to class members who provide a “timely proof of claim.” The coupons, worth $6 each, could be used for various H&R Block tax-preparation services over the next three years, the company said. Class members will also receive cash after plaintiffs’ attorney fees are awarded by the judge, with the amount dependent on how many class members file a claim. H&R Block said the settlement would end all class-action lawsuits related to the loans.
Thinking of making a debt settlement offer? See common settlement scams and rip-offs firstRelated Posts
- Judge allows $62.5 million H&R Block settlement to proceed
- H&R Block Inc makes changes after lawsuit
- Block, HSBC Settle Predatory Lending Suit
- Bank Won't Cash Block's Rapid Refund Checks
Related Searches: tax refund loans, refund anticipation loans, class action lawsuits, kansas city mo, class action lawsuit
Call somebody about this, anywhere in the world, for FREE
CHICAGO–(BUSINESS WIRE)–April 19, 2006–Plaintiff class representative Lynne A. Carnegie has reached an agreement with H&R Block Inc. (NYSE:HRB) and Beneficial National Bank, for itself and its successors, that would settle a 1998 Chicago class action lawsuit related to refund anticipation loans (RALs).
The proposed $39 million settlement, which would be paid equally by Beneficial National Bank and H&R Block, was filed today in an action that has been pending in the U.S. District Court for the Northern District of Illinois under the caption Carnegie v. Household International, Inc., et al. The proposed settlement would cover refund anticipation loans that had been funded by Beneficial National Bank and offered through an H&R Block office from April 8, 1994 through Dec. 31, 1996. Overall, the proposed nationwide settlement would make available cash payments to approximately 1.7 million class members who made approximately 2 million individual RAL transactions.
The proposed settlement makes at least $30 million cash available to the class. Class members who submit valid timely claims will receive a cash payment for each RAL. The amount per RAL will depend on the number of claims to be paid. The remainder of the settlement fund would be used to reimburse plaintiffs’ counsel for the costs of the litigation and pay their fees, and also cover costs associated with mailing and publishing the class notice and administering the settlement.
The proposed settlement is subject to the review and approval of U.S. District Judge Elaine Bucklo. If Judge Bucklo grants preliminary approval of the settlement, then the parties anticipate that notices will be mailed to class members within 45 days thereafter. Class members would have the right to exclude themselves from the settlement, subject to certain limitations, or to object to its terms at a fairness hearing that would be held later in 2006.