California's attorney general has filed a lawsuit against H&R Block in an attempt to halt the tax prep giant's loan program, which allows the company to take a percentage of clients' tax refunds in exchange for an advance.Attorney General Bill Lockyer filed suit in San Francisco Superior Court, noting that more than 1.5 million Californians have received tax refund loans through Block since 2001. A number of other suits have been filed around the country against Block, saying that the loan practice is unfair, especially because many low-income filers accept the offer.

In the suit, Lockyer alleges that the company misleads customers about the costs of the short-term loans, and can impose fees that translate into interest rates of more than 500 percent. Lockyer wants Block to pay $20 million in fines in addition to refunding customers for its alleged abuses. He will also ask for an order preventing the company from offering RALs in California.

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