The Consumer Financial Protection Bureau has gone on a bit of a tear with suits against charge card corporations, nailing Discover and Capital One earlier this year. American Express has joined the ranks, settling a suit with the Consumer Financial Protection Bureau and other companies and agreeing to return $85 million to consumers.
CFPB suits annoy American Express
The main goal of the CFPB is to defend consumers from financial services, but that does not just consist of creating new legislation. In fact, a variety of financial service providers are dealing with lawsuits for breaking regulations associated with other organizations.
Credit card companies have thus far been first in the firing line. Lawsuits involving the CFPB have been brought against Discover and Capital One, according to NBC News, both resulting in settlements in excess of $200 million, much of going to refunding customers.
CBS explained that one suit against American Express was filed by Utah state regulators, the Federal reserve, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Company and the CFPB. That lawsuit was recently settled.
$85 million returning to customers
There were a ton of laws broken by American Express, such as discrimination of those over the age of 35, charging late charges over legal limits, violating regulations for debt collection and reporting, not reporting billing disputes as mandated by law and making false claims about rewards.
American Express agreed to refund $85 million to consumers and pay $27.5 million in fines.
Subsidiaries American Express Bank and American Express Centurian Bank were in trouble because they charged a rate higher than legal limits for late charges, according to CNN. Rather than charging one fee, they charge a percentage, according to CBS. Also, $300 bonuses were offered to consumers who got the American Express "Blue Sky" car, but consumers did not obtain that ever.
Age was an enormous factor in the credit scoring system at American Express Centurian Bank. That is not legal because it is considered discrimination.
Also issue of debt practices
Some customers were promised that they would have an increased credit score if they paid off debts older than 7 years, which do not impact credit scores at all. CBS explained that his has occurred since 2003 and still happened this year. The lies were being told at American Express, American Express Bank and American Express Centurian bank.
In March 2013, about 250,000 people will get part of the $85 million concessions, according to NBC News.
CFPB suits annoy American Express
The main goal of the CFPB is to defend consumers from financial services, but that does not just consist of creating new legislation. In fact, a variety of financial service providers are dealing with lawsuits for breaking regulations associated with other organizations.
Credit card companies have thus far been first in the firing line. Lawsuits involving the CFPB have been brought against Discover and Capital One, according to NBC News, both resulting in settlements in excess of $200 million, much of going to refunding customers.
CBS explained that one suit against American Express was filed by Utah state regulators, the Federal reserve, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Company and the CFPB. That lawsuit was recently settled.
$85 million returning to customers
There were a ton of laws broken by American Express, such as discrimination of those over the age of 35, charging late charges over legal limits, violating regulations for debt collection and reporting, not reporting billing disputes as mandated by law and making false claims about rewards.
American Express agreed to refund $85 million to consumers and pay $27.5 million in fines.
Subsidiaries American Express Bank and American Express Centurian Bank were in trouble because they charged a rate higher than legal limits for late charges, according to CNN. Rather than charging one fee, they charge a percentage, according to CBS. Also, $300 bonuses were offered to consumers who got the American Express "Blue Sky" car, but consumers did not obtain that ever.
Age was an enormous factor in the credit scoring system at American Express Centurian Bank. That is not legal because it is considered discrimination.
Also issue of debt practices
Some customers were promised that they would have an increased credit score if they paid off debts older than 7 years, which do not impact credit scores at all. CBS explained that his has occurred since 2003 and still happened this year. The lies were being told at American Express, American Express Bank and American Express Centurian bank.
In March 2013, about 250,000 people will get part of the $85 million concessions, according to NBC News.
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