High Court Rules on Tax-Refund Loan Case
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The Supreme Court ruled that usury claims in a lawsuit involving H&R; Block Inc. customers who took out tax refund anticipation loans must be moved to federal court.
The high court ruled for Beneficial National Bank, a unit of Household International Inc., which had joined the nation’s leading tax preparer in making the loans.
A tax refund anticipation loan is made by a bank in the amount of the borrower’s anticipated tax refund, less interest and fees, enabling the borrower to get the money immediately rather than wait for the refund.
The lawsuit was brought in state court against Beneficial and H& R Block by 26 individuals in Alabama, alleging that the bank charged usurious interest rates in violation of state law.
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