Penalty Amount
$141,000,000
Consumers Affected
40,841
Connecticut Attorney General William Tong secured $1.2 million in restitution for 40,841 state consumers as part of a multistate $141 million settlement with Intuit Inc., the owner of TurboTax. The settlement resolves allegations that Intuit deceived low-income consumers into paying for tax preparation services that were offered for free through the IRS Free File program by using deceptive marketing tactics and confusing product names. Intuit must pay restitution, suspend its 'free, free, free' ad campaign, and implement business practice reforms.
Intuit must pay $141 million in restitution nationwide, including $1.2 million to Connecticut consumers, with affected individuals receiving approximately $29.64 per year deceived. The company must cease misrepresentations in advertising, enhance disclosures for free products, improve product design to inform users of free eligibility, and refrain from forcing consumers to restart filings when switching to free products.
In-house legal teams should review customer service agreements and terms of service for tax preparation software (e.g., TurboTax) and similar financial products. Focus on clauses governing marketing representations, pricing and fee disclosures, product/service tier definitions, and any guarantees related to 'free' offerings. Specific attention is needed on how product names and promotional materials are described contractually versus how they are advertised. Changes may be required to ensure clarity between 'free' IRS-sponsored options (like Free File) and paid products, revise pricing tables to eliminate ambiguity, and implement compliance mechanisms to prevent misleading advertising claims as mandated by the settlement's suspension of the 'free, free, free' campaign.
Entity
Intuit Inc.
Also known as: Intuit
Industry
TechnologyOfficial Press Release
https://portal.ct.gov/ag/press-releases/2022-press-releases/ag-tong-secures-restitution-for-connecticut-consumers-deceived-by-turbotax
final assurance intuit and nyag execution.pdf?rev=580985b6e7
https://portal.ct.gov/-/media/ag/press_releases/2022/final-assurance-intuit-and-nyag-execution.pdf?rev=580985b6e7ef4c939d9c01fae9130b53&hash=1A61AA3998B11420AFFBB7BDB4EFC19A
Connecticut Attorney General Enforcement Page
https://portal.ct.gov/AG/Privacy/Privacy-Resources
$29.6M
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$29.6M
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$45.0M
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