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Missouri lawsuit alleges tax preparers shared personal data with tech companies

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(The Center Square) – Three national tax preparation companies allegedly shared personal and sensitive information with three tech companies, according to a lawsuit filed by Republican Missouri Attorney General Andrew Bailey.

H&R Block, with approximately 2,000 employees working at its headquarters in Kansas City before the pandemic, Taxslayer LLC, and TaxAct, Inc., were named in a four-count lawsuit filed in St. Louis Circuit Court. The 33-page petition alleges the tax preparers illegally shared information with Meta, Google and other online tech companies.

“Because many Missouri consumers use private tax preparation companies to calculate and submit their taxes, they have no choice but to share their sensitive personal information with those companies,” the petition states. “Missouri consumers should be able to do so with confidence that their personal information is protected, and not being distributed or sold without their permission. Sadly, that is not the case here.”

The lawsuit alleges the companies used pixel technology – computer code in websites, email messages and other online methods that’s undetectable to the naked eye. However, if the user clicks on content or enters information, specific data is sent to company servers.

The companies allegedly violated the Missouri Merchandising Practices Act. The law states “any deception, fraud, false pretense, false promise, misrepresentation, unfair practice or the concealment, suppression, or omission of any material fact in connection with the sale or advertisement of any merchandise in trade or commerce or the solicitation of any funds for any charitable purpose… in or from the state of Missouri, is declared to be an unlawful practice…”

“Disclosure of data elements such as what buttons were clicked or the names of text-entry forms can and, on information and belief, did disclose a wide-array of sensitive personal, financial, and tax-related information of consumers, such as whether taxpayers were eligible for certain deductions or exemptions,” the petition states.

The petition lists the information it alleges each company allowed to be gathered and sent to tech companies, including names, phone numbers, addresses and incomes, among other information.

H&R Block, with a market capitalization of approximately $4 billion, has a 531,168 square-foot building rising 18 floors for its headquarters in downtown Kansas City. H&R Block, TaxSlayer and three other companies were investigated in 2019 by the state of New York for editing website code so consumers wouldn’t find information on a free program to file an IRS return in search engine results.

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