Missouri AG sues JK Harris & Co.

Chris Rizo Aug. 12, 2008, 4:49pm

Jay Nixon (D)

JEFFERSON CITY, Mo. (Legal Newsline)-Missouri Attorney General Jay Nixon on Tuesday sued a debt relief company, saying that it failed to help consumers resolve their state and federal tax woes.

The lawsuit against South Carolina-based JK Harris & Co. alleges the company charged clients as much as $4,500 and didn't receive the services or refunds they requested.

"JK Harris promises it can help consumers who are having tax problems, but the Missourians who complained to my office told a different story: one of unreturned phone calls, lost paperwork and a worse financial situation than when they started," Nixon said in a statement.

Nixon is asking a Jackson County Circuit Court judge to issue an order requiring the company to provide full restitution to all Missouri consumers hurt by JKH's "deceptive practices."

The lawsuit also asks for preliminary and permanent injunctions to prohibit the defendants from further violations of Missouri consumer protection laws, as well as for penalties and costs.

Also named in the lawsuit is an affiliated company, Professional Fee Financing Associates LLC, which is accused of failing to disclose information about finance charges, payment schedules, the total number of payments and the total price consumers must pay.

In June, JK Harris & Co. agreed to pay $1.5 million in restitution and change its advertising, under an agreement with 18 state attorneys general.

At the time, JK Harris denied any wrongdoing, and said the agreement comes at the betterment of the tax debt consulting industry.

"We are pleased that we have been able to reach an agreement with the states," said Josh Baker, JK Harris' director of communications. "We have made every effort to cooperate with them and believe the agreement we have reached will make our company and our industry stronger."

States participating in the judgment in addition to Illinois were Arkansas, Arizona, California, Connecticut, Florida, Illinois, Maine, Michigan, Minnesota, New York, North Carolina, Ohio, Pennsylvania, South Dakota, Tennessee, Vermont, and West Virginia.

The states will share in a $300,000 pool to help cover the costs of the investigation.

From Legal Newsline: Reach reporter Chris Rizo at chrisrizo@legalnewsline.com.

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