The CFPB has gone on a bit of a tear with cases against credit card companies, nailing Discover and Capital One a few months ago. American Express has joined the ranks, settling a suit with the Consumer Financial Protection Bureau and other agencies and agreeing to refund $85 million to consumers.
American Express joins ranks of card corporations slapped with Consumer Financial Protection Bureau lawsuits
The main goal of the Consumer Financial Protection Bureau is to guard consumers from financial services, but that does not just include producing brand new legislation. In fact, a lot of financial service providers are dealing with suits for breaking laws associated with other companies.
Both Discover and Capital One have already faced suits from the Consumer Financial Protection Bureau amounting to over $200 million in settlements. A lot of that cash is going back to consumers according to NBC News. It seems charge card corporations have been the first targets.
Another suit was just recently settled with American Express too, according to CBS. However, the lawsuit did not just contain the CFPB. There were also complains from the Federal Reserve, regulators in Utah State, the Federal Deposit Insurance Company, and the Office of the Comptroller of Currency.
$85 million returning to customers
American Express is in trouble for breaking multiple laws, such as failing to report billing disputes and regulations about debt collection and reporting. It also charged late charges over legal limits and made false claims about rewards. Also, applicants over the age of 35 were discriminated against.
The charge card company is ordered to pay $27.5 million in fines and $85 million back to consumers in a refund.
One problem was with subsidiary American Express Centurian Bank who never gave consumers the $300 reward guaranteed for signing up for an American Express "Blue Sky" cad. CBS explained that the companies were charging late fees based on a percentage too, according to CNN. The problem with that was that they were charging more than already established limits.
Age was an enormous factor in the credit scoring system at American Express Centurian Bank. That is not legal because it is recognized as discrimination.
Also issue of debt practices
At American Express and its subsidiaries, there were lies being told from 2003 until now, according to CBS. The lie was that customers could increase their credit scores if they paid off debts older than 7 years. These debts do not even show up on a credit score after that period of time.
In March 2013, about 250,000 people will get part of the $85 million concessions, according to NBC News.
American Express joins ranks of card corporations slapped with Consumer Financial Protection Bureau lawsuits
The main goal of the Consumer Financial Protection Bureau is to guard consumers from financial services, but that does not just include producing brand new legislation. In fact, a lot of financial service providers are dealing with suits for breaking laws associated with other companies.
Both Discover and Capital One have already faced suits from the Consumer Financial Protection Bureau amounting to over $200 million in settlements. A lot of that cash is going back to consumers according to NBC News. It seems charge card corporations have been the first targets.
Another suit was just recently settled with American Express too, according to CBS. However, the lawsuit did not just contain the CFPB. There were also complains from the Federal Reserve, regulators in Utah State, the Federal Deposit Insurance Company, and the Office of the Comptroller of Currency.
$85 million returning to customers
American Express is in trouble for breaking multiple laws, such as failing to report billing disputes and regulations about debt collection and reporting. It also charged late charges over legal limits and made false claims about rewards. Also, applicants over the age of 35 were discriminated against.
The charge card company is ordered to pay $27.5 million in fines and $85 million back to consumers in a refund.
One problem was with subsidiary American Express Centurian Bank who never gave consumers the $300 reward guaranteed for signing up for an American Express "Blue Sky" cad. CBS explained that the companies were charging late fees based on a percentage too, according to CNN. The problem with that was that they were charging more than already established limits.
Age was an enormous factor in the credit scoring system at American Express Centurian Bank. That is not legal because it is recognized as discrimination.
Also issue of debt practices
At American Express and its subsidiaries, there were lies being told from 2003 until now, according to CBS. The lie was that customers could increase their credit scores if they paid off debts older than 7 years. These debts do not even show up on a credit score after that period of time.
In March 2013, about 250,000 people will get part of the $85 million concessions, according to NBC News.
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