Wyden Urges Justice Department to Investigate Intuit Purchase of Credit Karma

Potential purchase has serious implications for consumer choice, data privacy

Washington, D.C. – Senate Finance Committee Ranking Member Ron Wyden, D-Ore., urged the Justice Department to investigate Intuit’s purchase of Credit Karma, which has serious implications for both consumer choice and data privacy.

“Intuit’s highly-profitable tax preparation business depends both on duping low-income tax-filers and in eliminating the threat posed by universal free-filing options from competitors like Credit Karma. Without Credit Karma’s free tax filing product, consumers will have far fewer choices and many of them will have to pay $60 and up for a product that is available for free today,” Wyden wrote.

Wyden continued, “In addition to the anti-competitive issues raised by this deal, Intuit’s purchase of Credit Karma also raises serious questions about the impact on Americans’ privacy. Credit Karma provides free credit monitoring services to 100 million consumers — an essential service these days, given the frequency of mega data breaches. As a result, the company holds a huge amount of sensitive consumer data, which Intuit will be able to monetize in ways that are counter to the interests of the Americans from whom it was collected. The acquisition of such a large amount of highly-sensitive financial data about Americans deserves significant scrutiny under any circumstances.”

Full text of the letter is here and as follows:

April 6, 2020

The Honorable Makan Delrahim

Assistant Attorney General, Antitrust Division

The U.S. Department of Justice

950 Pennsylvania Avenue, NW

Washington, DC 20530

Dear Assistant Attorney General Delrahim:

I write to ask that the Department of Justice (DOJ) take action to protect consumers by investigating Intuit’s acquisition of Credit Karma.

On February 24, 2020, Intuit — the company that makes TurboTax, QuickBooks and Mint — announced that it is purchasing Credit Karma, which offers a competing, free tax filing product as well as free credit monitoring and other financial services to 100 million consumers.

According to Internal Revenue Service data analyzed by ProPublica, TurboTax controlled 67% of the market for online tax preparation services in 2019. This generated 2.2 billion dollars of revenue for Intuit.

Intuit does offer a free version of Turbotax Online, however, it is only available to filers with the most basic tax returns. Moreover, investigative journalists have repeatedly exposed how Intuit exploited “dark patterns” on its website and manipulated search engine results to trick low-income tax filers eligible for its Free File service into unnecessarily paying for Turbotax. Intuit’s highly-profitable tax preparation business depends both on duping low-income tax-filers and in eliminating the threat posed by universal free-filing options from competitors like Credit Karma.

Without Credit Karma’s free tax filing product, consumers will have far fewer choices and many of them will have to pay $60 and up for a product that is available for free today.

In addition to the anti-competitive issues raised by this deal, Intuit’s purchase of Credit Karma also raises serious questions about the impact on Americans’ privacy. Credit Karma provides free credit monitoring services to 100 million consumers — an essential service these days, given the frequency of mega data breaches. As a result, the company holds a huge amount of sensitive consumer data, which Intuit will be able to monetize in ways that are counter to the interests of the Americans from whom it was collected. The acquisition of such a large amount of highly-sensitive financial data about Americans deserves significant scrutiny under any circumstances.

DOJ has until April 7, 2020, to make a determination on whether or not to investigate Intuit’s purchase of Credit Karma. Given the serious competition and privacy concerns I have detailed above, and DOJ’s significant coronavirus-related staffing and resource constraints, I urge you to extend the clock and give this deal the close scrutiny it deserves.

Thank you for your attention to this important matter.

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