KANSAS CITY, Mo. (AP) _ The Securities & Exchange Commission is investigating disclosures H&R Block Inc. made about litigation stemming from its refund anticipation loan business, the company said Friday.

H&R Block, the nation's largest tax preparer, said its outside counsel received a notice Thursday of the formal order of investigation from the SEC. The order concerns disclosures made in and before November 2002, the company said.

The Kansas City, Mo.-based company has fought, and in some cases has settled, several class-action lawsuits that charge it misled its clients when it did not disclose the true costs of the short-term ``refund anticipation'' loans, offered to customers awaiting income tax refunds.

H&R Block said it intends to cooperate fully with the SEC. Spokesman Bob Schneider said the company has fully disclosed details about litigation that began soon after it began offering the loans in the early 1990s and peaked with a $41.7 million settlement in a Texas case in November 2002.

The conclusion of the 6-year-old Texas case took the company by surprise, Schneider said, but H&R Block was given little choice but to settle.

``In November 2002 we got a letter from a judge that said he was going to skip trial and go right to a trial for damages,'' Schneider said. ``He indicated what he was going to fine us, and the settlement we reached was significantly less than that.''

Still, he said, the company had not anticipated such a large settlement. But he said H&R Block divulged the details as soon as they were available.

``In retrospect, should we have anticipated that amount of money?'' he asked. ``We believe we disclosed everything, based on everything that was known at the time. Could we have anticipated what we saw as fairly surprising unilateral decision by a judge to do what he did? Certainly we didn't anticipate it would be anything like it was.''

News of the investigation came the same day the company forecast a smaller-than-usual increase in the number of people filing tax returns next year because of the country's unemployment rate.

H&R Block chairman, chief executive and president Mark Ernst said the Internal Revenue Service recently lowered the expected increase in tax filers to 0.5 percent from the usual 1.5 percent growth rate.

``And we understand why they'd say that,'' he said. ``Our analysis of the impact of the economy has us seeing the same thing. While overall economic numbers are picking up, the employment numbers haven't improved dramatically.''

Ernst said the company's marketing message last year failed to drive as many tax filers into H&R Block offices as it expected, so the company has revamped its approach.

The new message focuses on a client's entire financial health, not just taxes, ``and how H&R Block can help them through challenging financial times and what (clients) can do today to improve their financial life,'' Ernst said.

Beyond taxes, H&R Block also has a mortgage business, a financial advice business and an accounting, tax and consulting business.

The company also has also expanded its distribution. It inked a deal with Wal-Mart Stores Inc. in September to put tax-preparation offices in some Wal-Mart stores, and will begin opening those offices on Jan. 15, Ernst said.

H&R Block shares rose 3 cents to close at $51.72 Friday on the New York Stock Exchange.