The lawsuit, filed in Manhattan's state Supreme Court, says Block advised clients to buy an "unsuitable, fraudulently marketed, poorly performing, fee-ridden 'retirement vehicle' called the Express IRA," an account that actually shrinks over time.
The court papers, filed by Attorney General Eliot Spitzer, say the money in the retirement account decreases because the only investment option offered is a money market account with an interest rate so low that it does not cover the fees — "fees that H&R Block fails to adequately disclose."
It seems that they were conning people into buying a money market fund that for for instance would pay you 1% interest but charges you 2% in management fees. I have never heard of such a thing before. I have seen mutual funds underperform and thus hand someone a loss and charges you a management fee for that loss. But I have never seen something like this happen to a money market fund though.
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