Wednesday, February 2, 2011
NYC Community Organizations Blast Wal-mart for Partnering with Predatory Lender Jackson Hewitt
Citing History of Targeting Low-Income Families, City’s Biggest Community Organizations Join Coalition to Keep Wal-mart Out of City
On the last day for employers to send out 2010 W-2 notices, a group of New York City’s most powerful community-based organizations blasted Wal-mart for its recently announced partnership with Jackson-Hewitt, a tax preparation firm that specializes in controversial Refund Anticipation Loans.
According to Jon Kest, Executive Director of New York Communities for Change, “By partnering with one of the nation’s most notorious predatory lenders, Wal-mart has once again shown its true colors. While the company may claim to care about low income families, deals like this show their real goal is to make as much money off the backs of poor people as possible.”
Refund Anticipation Loans charge interest rates as high as 24% APR in exchange for giving taxpayers an advance on their expected tax refunds. The loans frequently target low-income families, and the IRS has long sought to ban them. Jackson Hewitt is poised to become the largest provider of such loans in the nation.
With Jackson Hewitt announcing this January that it would open service stations in over 2,000 Wal-marts around the country, leaders of many organizations representing low income New Yorkers worry that Wal-mart’s plans to open up stores in New York City could leave their members subject to exploitation.
Several community-based organizations will soon vote on endorsing the Wal-mart Free NYC Coalition, a growing alliance of workers, residents, small business owners, community leaders, clergy, and elected officials committed to keeping Wal-mart out of New York City.
Today, New York Communities for Change, Make the Road New York, Desis Rising Up and Moving (DRUM), and Picture the Homeless all announced their official endorsements of the Wal-mart Free NYC coalition.
One Make the Road New York member who runs a small business providing tax assistance to low income families across the city said he supports his organization opposing Wal-mart because the company would prevent small business owners like him from helping the community.
“As someone who works preparing people’s taxes, I know that Jackson Hewitt’s practices are predatory, and I think the fact that Wal-mart and Jackson Hewitt are working together is a sham. It just shows how much Wal-mart cares about the neighborhoods where it opens its stores. Jackson Hewitt’s practices don’t treat people right, and neither do Wal-mart’s. Instead of focusing on these big companies, we should be focusing on how businesses like mine and others like it can flourish, and how New York City can strengthen its small business motor.” said Carlos Bustamante, President of EZ Tax New York and member of Make the Road New York’s Small Business United project.