CHARLESTON, W.Va. (AP) – A Kanawha Circuit judge gave preliminary approval Friday to a $62.5 million settlement between H&R Block Inc. and an estimated 8 million consumers in more than two dozen states, including Maine, who exchanged tax refunds for upfront payments.

The deal resolves four class-action lawsuits as well as potential claims alleging the nation’s largest tax preparer violated state consumer protection laws.

The company offered quick payments, formerly known as “Rapid Refunds,” to customers expecting tax refunds. They were actually loans repaid by those refunds that featured interest rates of between 29 percent and 750 percent.

While admitting no wrongdoing, H&R Block has agreed to offer payments to customers who took out these refund anticipation loans. Depending on their state, consumers are eligible for payments for loans taken out as far back as mid-June 1989.

H&R Block, based in Kansas City, Mo., announced Wednesday that it planned to resolve the allegations through a 2003 lawsuit filed in West Virginia, one of the four class-actions. On Friday, Judge Duke Bloom ordered lawyers to mail information about the settlement’s terms to affected consumers by March 15.

Bloom has scheduled a June 8 hearing to field any objections and give the deal final approval.

“Allowing us to get this behind us and focus on the future is a great benefit to us,” H&R Block spokeswoman Linda McDougall told The Associated Press on Wednesday.

The claims alleged H&R Block didn’t follow state laws regulating businesses that offer loans. H&R Block and its agents also allegedly took “secret kickbacks” from the lending institutions that helped them arrange the refund anticipation loans.

H&R Block continues to offer refund anticipation loans, and the settlement requires the company to explain tax filing options, costs and other details about the loans.

“The goal is to ensure that consumers have all the information they need to make the best choices that meet their financial needs and to ensure that the disclosures set the industry standard,” H&R Block said in a statement.

The settlement covers lawsuits and claims in West Virginia, 24 other states and Washington, D.C.

The other states covered by the settlement are: Alabama, Arkansas, Arizona, California, Florida, Illinois, Indiana, Massachusetts, Maryland, Maine, Michigan, Minnesota, Missouri, Nebraska, New Hampshire, Nevada, Ohio, Oregon, Pennsylvania, Tennessee, Utah, Virginia, Washington and Wisconsin.

The settlement does not resolve all the cases filed over the company’s refund anticipation loans. A Pennsylvania lawsuit remains pending, and H&R Block faces a March trial in a federal class-action in Illinois that alleges it violated racketeering laws.

On the Net:

http://www.hrblock.com

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