Spitzer accuses H& R Block of defrauding investors

0 Comments | USA TODAY, March, 2006 | by Sandra Block

Four years ago, H&R Block, facing criticism from consumer groups over some of its practices, launched a program called the Express IRA that it said would encourage low-income people to save for retirement.

Wednesday, New York Attorney General Eliot Spitzer said that program had done precisely the opposite. In a $250 million lawsuit, Spitzer said Block defrauded hundreds of thousands of people by persuading them to invest in a "poorly performing, fee-ridden 'retirement vehicle'"

that was guaranteed to lose money.

The lawsuit charges that 85% of people who opened Block's Express IRA accounts paid more in fees than they earned in interest. It also says Block failed to disclose the fees.

Spitzer also charged that more than 150,000 H&R Block customers...