More Fraudsters Coming Right Up
Bank of America wasn’t the only player of this game of frauds.
The CFPB’s Cordray says, “Through five enforcement actions the Bureau has taken to date on credit card add-on products, we have now put nearly $1.5 billion back into consumers’ pockets. We intend to continue cleaning up this market as necessary to ensure that consumers are treated fairly.”
They’ve been looking at add-on products since the agency’s inception three years ago. Their first enforcement action came in July 2012 against Capital One Financial Corp. for using vendors who aggressively marketed and sold similar add-on products. Next, Discover reached a $214 million settlement over allegations that it improperly marketed payment protection and identity theft services to credit card customers.
American Express paid a $76 million settlement in December based on allegations of deceptive marketing and unfair billing practices selling credit card add-on products to its customers.
American Express in late 2012 was charged $112 million in fines and refunds on allegations that it violated debt-collection practice laws, discriminated against new customers based on age, and failed to report consumer disputes to the credit bureaus.
According to an American Banker article today, “Most of these companies have since either stopped offering or changed their credit card add-on products. But that has not slowed down the agency.”
“We’re going to continue to look at these problems as we become aware of them and determine in each case what action is appropriate,” said Morris, the CFPB’s deputy enforcement director.
Now, if they can just build a big enough jail…
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