Getting Worse Part 2: Intuit's CEO Informs Employees That Free To File Was Hidden For The Public's Own Good

Failures

from the pro-public-uh... dept

Like we said, Intuit apparently wants to keep digging this hole for itself. After our initial coverage of ProPublica’s excellent posts on how Intuit was going to crazy lengths to keep anyone from finding its free to file tax prep site, we followed up with reports of how many Intuit reps were lying to keep from giving people refunds. Those lies included claims that Intuit and TurboTax don’t even run the free to file program and that it was instead operated by the IRS itself with TurboTax branding. Another lie was that ProPublica’s reporting was all wrong and that the news organization was about to run a retraction. Spoiler alert: no they are not.

But it seems that the Intuit brass aren’t content only to lie to the public. Intuit’s CEO managed to cobble together an internal video — which of course leaked — so that he could lie to his own staff as well.

Sasan Goodarzi, the CEO of Intuit, says the company’s efforts to make its free tax-filing software harder to find on Google were part of the software giant’s commitment to educating taxpayers. In an 11-minute video sent to Intuit employees, Goodarzi said the company was trying to help consumers by steering them to “educational content” instead of TurboTax’s free filing website.

Responding to our reporting, which shows that Intuit, H&R Block and other for-profit tax software companies were steering low-income customers to their paid products, Goodarzi said the company’s marketing practices “had been misinterpreted to signal that we were trying to hide the product we offer in the IRS program. That is inaccurate.”

That’s nonsense. Intuit’s decision to combine buying Google ads and de-indexing the free to file site via robot.txt file has only one reasonable motivation: to hide the free option and push people to the paid services. It’s also clear from the result of these actions, which is that 3% of taxpayers eligible to file for free did so, with 97% instead paying for services they didn’t need. That’s a whole lot of “educating” going on, all of which happens to result in gobs of money for Intuit.

We’ll put the entire video at the bottom of the post for your enjoyment, but there are a couple of sections we should highlight in text.

“Over the past five years, tens of millions of consumers filed their taxes for free using one of our free offerings. That is more than every tax prep company combined.”

If there are any hard statistics to back this statement up, Goodarzi doesn’t offer them. Neither did Intuit’s PR folks when ProPublica asked for them. The end result, whatever the actual hard numbers, is that 3% of eligible taxpayers used the free to file program. That number ain’t great.

We created a holistic marketing approach including widely used search techniques to differentiate between our own free products and the one we offer through the Free File program. Knowledge is power and we wanted to equip taxpayers with the information they need to make an informed choice and more easily find the product they were looking for. As you know we advertise a lot. We’ve all seen them: “free free free.” Because we advertise so much, our experience and our common sense tells us that the majority of people doing internet searches for the words “TurboTax free tax preparation” are looking for TurboTax free product. Not the one we offer through the IRS Free File program.

This takes a lot of stones. Suggesting that the average person searches the internet for “TurboTax free tax preparation” looking for not free tax prep by TurboTax takes the kind of full on blatant lying typically reserved for current American Presidents. And keep in mind that these poorly-spun lies are being told to internal Intuit employees. Why anyone would want to listen to this and continue to work there is beyond me.

And, amazingly, despite this vociferous defense of Intuit’s practices, the video culminates with Goodarzi stating that the company has ceased hiding the free to file site due to all of this “fake news” reporting.

Our choice around search was intended to be in the best interest of taxpayers so they were more fully informed about their options and could choose what they felt was best for them. But given the misinterpretation of our well intended actions, we decided to remove the limitations we put in place.

I doubt, frankly, that this will be enough to keep away the current lawsuits and the many, many more that I imagine are in the midst of being drafted. This has class action lawsuit written all over it.

And the more Intuit continues digging this hole, the worse it will get.

Filed Under: free file, free tax filings, sasan goodarzi, taxes, turbotax
Companies: intuit