Liberty Tax's Parent Company Told to Pay $1.3M in Ad Case

Virginian-Pilot (VA) 
January 19, 2013
McGlone, Tim

A California appeals court recently ruled that JTH Holding Inc., the parent company of Liberty Tax Service, must pay $1.3 million in penalties over misleading ads. The decision upholds a trial judge's finding that Liberty deceived customers through refund anticipation loans (RALs) and electronic refund checks. Liberty was found to have falsely portrayed its RALs as IRS tax refunds and to have failed to educate its staff about the legalities in advertising or control its franchisees. The trial judge ordered JTH to pay $1.17 million in civil penalties plus $130,000 in restitution and permanently barred Liberty from advertising RALs as tax refunds. Consumer advocates have long criticized RALs provided by large U.S. tax preparers, citing excessive interest rates and fees.
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