Credit Card Companies: Check’s in the Mail, America. Really.

Wednesday, 19 Dec 2012 07:52 AM

By John Morgan

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Major credit card issuers are refunding $435 million to customers nationwide for deceptive card practices, according to CNNMoney.

The refunds – from Discover, American Express and Capital One – were prompted by a crackdown by the new Consumer Financial Protection Bureau (CFPB).

Analysts at Thomas Reuters predict more consumer finance enforcement actions at the federal level should be expected now that the election is over.

Editor's Note: How to Pay Zero Taxes . . . Legally

Thomson Reuters reported CPFB Director Richard Cordray as stating it is not the “intention to try to ding institutions on things where it’s not very clear what the law is or what the law says … in gray areas. That’s not really worth our time or theirs.”

CNNMoney said some credit card customers have received refunds already, and the rest could expect payment by the end of March.

Capital One said it would send out refunds during the first quarter.

Capital One was ordered in July to refund $150 million to 2 million customers following allegations its vendors were “pressuring and misleading customers into buying additional products or services when they opened credit cards,” CNNMoney said.

Discover, meanwhile, said it will complete its customer refunds, a total of $200 million to 3.5 million customers, by mid-February.

The CPFB said Discover telemarketers used deceptive language to persuade cardholders to pay for identity theft protection, credit-score tracking, wallet protection and payment protection. Fees varied from $2.99 to $9.99 monthly for those services.

Finally, American Express has begun paying a total of $85 million in refunds to 250,000 customers after the agency said Amex subsidiaries imposed higher late fees than allowed, and promised customers non-existent monetary rewards.

For all three issuers, current cardholders affected by the deceptive practices will automatically receive a credit on their account, while former customers will receive a check in the mail or have their outstanding balances reduced, CNNMoney said.

Editor's Note: How to Pay Zero Taxes . . . Legally

© 2014 Moneynews. All rights reserved.

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