H&R Block has agreed to settle the latest in a series of lawsuits filed against it for its practice of "refund anticipation loans," or "payday loans."
The settlement was announced Dec. 21st, with a West Virginia Circuit Court judge scheduled to consider the agreement on Dec. 23rd.
The terms of the settlement would resolve claims in 22 states and the District of Columbia, as well as four class-action lawsuits in West Virginia, Ohio, Maryland, and Alabama.
Under the settlement, Block would pay claims to 8 million customers who took out payday loans between 1989 and 2005. The terms of the payout were not disclosed, but Block stated it would have to incur a third-quarter tax charge of $31 million to cover the claims.
The settlement would not affect a case pending in Chicago against Block and its partner, HSBC Financial Services, for racketeering charges in relation to their pushing of payday loans on customers. A previous settlement offer was rejected, and the case is scheduled to go to trial in March 2006