Google Tax Filing Wiretap

A class action lawsuit was recently filed against Google alleging that the search engine giant is knowingly “wiretapping” several American tax preparation websites and gathering sensitive personal and financial data it can then sell to the highest bidder for advertising purposes.

According to the lawsuit, online tax filing services including H&R Block, TaxAct, and TaxSlayer among others use Google Analytics tracking pixel technology on their websites. Whenever a user lands on these websites, the tracking pixel intercepts and records all communications between the user and the tax filing website.

Google amasses enormous amounts of data about its users

Google Analytics can collect as many as 200 different metrics. While Google maintains that the information it collects is not associated with individuals, a Stanford and Princeton study [PDF] found that Google’s tracking software is able to ‘successfully carry out de-anonymization’ through a simple process that leverages a user’s web browsing history collected by other Google’s tracking tools.’ The efficacy of this de-anonymization is apparent to anyone who is suddenly targeted with ads whose subject material is in some way associated with a previous website visit.

Google knew its technology would be used to ‘illegally intercept’ electronic communications

Under American law, tax-return information cannot be disclosed to unauthorized parties without the express consent of the tax payer. According to the complaint, “Google would have known, or at best recklessly turned a blind eye to, the fact that it was collecting vast amounts of confidential tax information. Income and other related financial information are highly valuable demographic markers for advertising purposes.”

The lawsuit claims Google violated a number of federal and state privacy laws designed to protect U.S. citizens. These include –

• The Federal Wiretap Act,
• The California Invasion of Privacy Act,
• The Florida Security of Communications Act,
• The Illinois Eavesdropping Act,
• The Texas Criminal Wiretap Act,
• Invasion of Privacy (Common Law and Constitutional Rights)

Though privacy concerns about “wiretapping” from tracking pixels and related scripts have been with us for two decades, it wasn’t until Facebook’s Cambridge Analytica scandal in 2018 that government officials started to raise the alarm over the magnitude of data collected by big tech and the power these companies have to influence opinions among the citizenry.

The lawsuit comes in the wake of a recent senate report [PDF] that states TaxAct, H&R Block, and TaxSlayer had admitted “that they shared taxpayer data via their use of the Meta Pixel and Google’s tools.”

Case Updates: Case No. 23-cv-03527-PCP

June 3, 2024: Order Denying Google’s Motion To Dismiss