Facebook Pixel Collects Tax Filing Information Class Action

While this class action is yet another against Meta Platforms, Inc. that takes issue with the collection of information by its Facebook Pixel tracking tool, it highlights an area of alleged information collection that is even more concerning: tax preparation. The complaint alleges the Pixel “is being improperly used on the websites of financial services providers and online tax-filing services,” to send Meta private financial and tax filing information. The complaint states flatly that “transmission of tax-filer data is a crime.”

The Nationwide Class for this action is all Facebook users who are current or former customers of any financial services or tax-preparation software company in the US with web properties through which Facebook acquired sensitive financial or tax information for which neither the financial services company nor Facebook obtained a valid consent.

The companies that use the Pixel on their websites to share tax filer information, which complaint calls the Facebook Partner Financial Data Providers, allegedly include H&R Block, TaxAct, and TaxSlayer.

Under federal law, tax preparers are supposed to keep tax information confidential. They may disclose it in limited circumstances with the taxpayer’s consent, with the standards for that consent set forth in regulations. The complaint alleges that “conditioning the provision of any services on the taxpayer’s furnishing consent will make the consent involuntary,” so that “the consent will not satisfy the requirements” of the regulations. Consent cannot be retroactive, the complaint claims, that is, it cannot be obtained after the disclosure is made.

The Meta (or Facebook) Pixel is a bit of code that companies can install on their websites, the complaint alleges, that tracks visitors and the actions they take at the website. The complaint alleges that “the Facebook Pixel source code causes the exact content of the communication with their tax filing provider to be redirected to Facebook in a fashion that identifies them as a tax filer and sends filers’ tax-return data to Meta without their consent and in violation of federal law.”

According to the complaint, Facebook claims to require the entities who send it information “to have lawful rights to collect, use, and share … data before providing any data to us.” However, the complaint alleges that Facebook has done nothing to verify that the entities do in fact have such consent to send it this kind of private information. It also claims that the Facebook Partner Financial Data Providers do not obtain valid consent from their customers.

The complaint alleges that Facebook uses the information it receives to make money through targeted advertising on and off of Facebook.

Article Type: Lawsuit
Topic: Privacy
Tags: Breach of Contract, Sharing Personal Information with Third Parties, Your Privacy, wiretapping