Governor Cuomo Calls on Department of Financial Services and Department of Taxation and Finance to Investigate Tax Return Preparers’ Alleged Tactics to Reduce Access to Free Tax Filing Options
Governor Andrew M. Cuomo today called on the New York State Department of Financial Services and the New York State Department of Taxation and Finance to investigate TurboTax, H&R Block and other major tax return preparers following recent reports that these companies allegedly used Google advertisement and website features to deceptively hide additional tax filing options from low-income individuals who are eligible to file their taxes for free.
“The allegations against these major tax return preparers are disturbing, and New York will not stand idle as the public’s interest is undermined in order to pad the profits of wealthy corporations,” Governor Cuomo said. “I am calling on the Department of Financial Services and the Department of Taxation and Finance to investigate these claims to help ensure New Yorkers are protected. We have zero tolerance for these deceptive practices and those responsible will be held accountable for these egregious actions.”
Americans with an adjusted gross income of $66,000 or less are eligible to file their taxes for free through the Free File Alliance -a partnership between the IRS, tax software providers and states – including New York. According to the reports, the websites of the tax software providers steered consumers into paying for services when they were eligible to file their taxes for free, and hid these free filing options from Google searches.
New York’s Consumer Protection Initiatives
Under Governor Cuomo’s administration, New York has taken regulatory and legislative action to ensure the protection of consumers across the state. In March, the Governor announced a new law limiting debt collections against deceased debtors and their families following reports that debt collection companies have tried to use techniques to pressure relatives for payments. Under the amendment, debt collection companies can no longer make any misrepresentation about the family’s obligation to pay the debt.
Earlier this year, the Governor also launched an education initiative for the digital age, including an examination of the terms of service and privacy policies of popular web applications and services, following reports that Facebook secretly accessed personal information of users. In February, Governor Cuomo directed the New York Department of State, Department of Financial Services and other state agencies to investigate these reports and urged federal regulators to also take action to protect the rights of consumers.
In January, the Governor issued a consumer alert warning New Yorkers about a bug in the Apple FaceTime app that reportedly allowed users to receive audio and video from the device of the person were calling even before the person accepted or rejected the call. Governor Cuomo, in partnership with Attorney General Letitia James, immediately took action and announced an investigation into the privacy breach, directing New Yorkers to contact the Department of State’s Division of Consumer Protection to report consumer complaints.
In addition, as part of the FY 2020 Enacted Budget, the Governor signed legislation passed by the legislature implementing sweeping reforms for licensing companies servicing student loans held by New Yorkers. The protections require that they meet standards consistent with the laws and regulations governing other significant lending products. The new statute also ensures that no student loan servicers can mislead a borrower or engage in any predatory act or practice, misapply payments, provide credit reporting agencies with inaccurate information, or any other practices that may harm the borrower.
In the wake of data breaches at credit reporting agencies such as Equifax that exposed the private data of millions of New Yorkers, the Department of Financial Services—at the Governor’s direction—issued a final regulation requiring agencies with significant operations in New York to register with DFS for the first time and to comply with New York’s first-in-the-nation cybersecurity standard. The regulation also provides the DFS Superintendent with the authority to deny, suspend and potentially revoke a consumer credit reporting agency’s authorization to do business with New York’s regulated financial institutions and consumers if the agency is found to be out of compliance with certain prohibited practices.