MAGIC’S FEELING HEAT
NBA legend Magic Johnson is being whis tled for a personal foul for his partnership with tax-preparation firm Jackson Hewitt, in which he hypes the company’s very expensive refund-anticipation loans.
Interest on the loans, known as RALs, can swell well into triple digits and have been attacked by consumer-rights groups for years.
For example, on a typical RAL of $3,000, consumers pay the equivalent of an annual interest rate of between 77 percent and 140 percent – for a one- or two-week loan against money they would have gotten from Uncle Sam in less than two weeks.
Nationally, consumers shelled out an eye-popping $833 million in RAL fees in 2007, according to a study by the National Consumer Law Center, much of it from low-income taxpayers who can least afford the high fees.
Alexis Iwanisziw, with the consumer education group Neighborhood Education Development Advocacy Project, was very troubled by Johnson’s partnership with Jackson Hewitt.
“I hope it’s just that he doesn’t know the damaging effect RALs can have on communities, and how much money they siphon out of these communities,” said Iwanisziw.
Statistics also show RALs are heavily skewed towards the residents of Black and Latino neighborhoods. In New York in 2006, four out of five RALs were made to people living in majority black and Latino neighborhoods, according to the group. “That’s amazingly concentrated,” Iwanisziw said.
The high cost of these loans is drawing heat to Johnson, who usually carries a heroic glow. He is know as one of the greatest pro basketball players ever, and an HIV-positive celebrity who has championed HIV/AIDS prevention and education, as well education and social causes in ethnically diverse urban areas, through his Magic Johnson Foundation.
The rising chorus of critics includes Illinois State Treasurer Alexi Giannoulias, who has blasted RALs as a rip-off targeting the working poor. Last week, the California Reinvestment Coalition and other protestors called for Johnson to stop shilling for Hewitt.
Jackson Hewitt says it discloses all fees to customers, and RALs may provide a viable financial option to clients with limited access to traditional banks. Magic Johnson did not return calls for comment.
Catherine Curan
Members only
They may not have won a game in four years, but at least the girls varsity team at Dallas [Tex.] Academy, which lost one recent game with a score of 100-0, is fashionably attired.
Kelli Delaney, president and designer of the Members Only line, heard about the terrible blowout that the eight girls on the Dallas Academy team suffered at the hands of Covenant School, a private, Christian school in Dallas, and was impressed by how the losing team soldiered on in the face of adversity.
The story gained national stature. Press reports said that the winners were up 59-0 at halftime and that the crowd cheered them on to try for a 100-point shut-out.
“My heart broke when I read the story so I called their headmaster, Jim Richardson, and asked if the girls would like to be my newest team ‘MEMBERS,'” said Delaney. “I sent the whole squad our pink nylon jacket that is a Hollywood favorite. Some of the girls are big fans of our celebrity following like Miley Cyrus, Fergie and Vanessa Hudgens, so they were really excited!”
The school specializes in reaching out to students with “learning differences” such as ADHD or dyslexia.
Since the story caught the national fancy, the girls have been the center of a media frenzy. Nike took the team to Phoenix for the NBA All-Star Game, and last week they were the dinner guests of NBA team owner Mark Cuban. They’ve also been on the Today Show and Good Morning America and at one point were on the front page of the Dallas Morning News five days in a row.
Delaney must have scored some good karma through her donation: last week she snared a Second Place International Design Award for Women’s Professional Sportswear.
Keith J. Kelly
Gore’s Web
Al Gore is trying to become master of his domain.
Combining his “invention” of the Internet with his championing of the environment, the former veep’s philanthropic organization, the Alliance for Climate Protection, is lending its support to the effort to establish “.eco” as a new domain.
If accepted, “.eco” will become an established domain name and function the same way “.com” or “.org” currently does. An application is expected to be filed by Dot Eco LLC for approval by the end of the year.
The “.eco” will serve as a namespace for individuals, companies and non-profits dedicated to improving the environment. A majority of the profits of the “.eco” initiative will be used to support environmental causes.
“This is a truly exciting opportunity for the environmental movement and for the Internet as a whole,” Gore said in a statement.
Gore will join other Dot Eco advisers, like former “James Bond” star Roger Moore, “An Inconvenient Truth” director Davis Guggenheim and Hollywood executive Minor Childers on the initiative.
Peter Lauria
business@nypost.com