Monday, January 02, 2006

Coyote Blog: State of California committing consumer fraud...Or an ingenious scheme to balance the state budget

Via Coyote Blog:
You gotta love the government. In September, the State of California sent me a check for $81 as a tax refund. I did not file for the refund -- they sent the check out of the blue. Since no one human being is smart enough to keep up with all the taxes and user fee formulas in California, I just accepted it, cashed the check and forgot about it. This refund was for my unemployment taxes, and I just assumed my rate had changed slightly leading to a refund.

Then, in December, the State of California sent me a notice that the $81 was in error, and I needed to send it back.

OK so far, I guess, though they seem a little Keystone Cops with this. But here is the good part- they claim I owe interest and penalties for holding their $81 since September, despite the fact they sent me the check out of the blue and it was their error. LOL. If this was a lot of money and not just $15 in interest and penalties (equaling a 97% implied APR) I would freak out, but at this level its just kind of funny. I mean, if I as a company was running this scam with consumers, sending them refund checks and then asking for the money back 3 months later with interest and penalties,I would be going to jail, would I not?


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