Intuit, the maker of TurboTax, has been sued in federal court in California, by two victims of identity theft. The putative class action has been filed on behalf of two people, one of whom was a TurboTax user and one who never used the tax preparation software. The lawsuit alleges that Intuit did not adequately protect the taxpayer data it collected. Richard D. McCune, attorney for the plaintiffs, discusses the lawsuit in this report.
McCune explains that the identity theft suffered by his clients is a very serious issue, but that it is also a serious threat to millions of TurboTax users. The number of people affected by the security problem remains a mystery, McCune says, because Intuit has been “very guarded” about releasing information. However, he believes that a substantial number of people have been affected.
Data breaches are nothing new, but Intuit denies that there has been a data breach. McCune says that he does not presently know how criminals have been getting the information used in the identity thefts. What makes the problem with TurboTax so significant is that the tax filing process involves providing social security numbers to the company. With credit card breaches, that piece of information is not involved.
For those identity theft victims whose social security numbers were used to file fraudulent tax returns, there is an additional problem: they can’t efile their own tax returns. Also, identity theft victims are forced to continuously monitor the electronic world to be sure that no further improper use has been made of their identity data. McCune says that the two plaintiffs in the lawsuit are typical of identity theft victims. They are simply living their lives when they suddenly discover that their identities have been compromised. They are in the position of trying to figure out what has happened and to stop any further improper identity use.
McCune says he has no firsthand knowledge of any security lapses by Intuit. However, he adds, there are a “couple of security whistleblowers,” former Intuit employees, who have said that there were problems with the company. The next step in the lawsuit will be to try to find out what has happened. More information will be available when the lawsuit enters the discovery phase.
Richard McCune is a partner of McCuneWright LLP in Redlands, California. He has 22 years of experience in representing Inland Empire and Southern California Plaintiffs in product liability, class action, serious personal injury, and business fraud cases. He has successfully represented clients in defective or dangerous product cases against GM, Ford, Chrysler, Honda, Toyota, Nissan, Mitsubishi, Caterpillar, and many other manufacturers. The Legal Broadcast Network is a featured network of the Sequence Media Group.