Over two million Chase credit card account holders who were charged for credit monitoring services will soon be getting a check in the mail, if they haven’t already.
The Consumer Financial Protection Bureau (CFPB) has ordered Chase to pay $309 million in refunds for illegally charging cardholders for add-on products in the form of credit monitoring services. The bank was found guilty of illegal billing practices and must give full refunds to any consumer who was charged as a result of the violations.
More than 2.1 million Chase customers are affected by this ruling, all of whom were billed between October 2005 and June 2012. The Dodd-Frank Wall Street Reform and Consumer Protection Act says that financial institutions may not engage in unfair, deceptive or abusive practices and gives the CFPB power to take action against any company doing so.
Many refunds already given
Chase has already issued refunds to the majority of customers who were charged for the credit monitoring service. They stopped marketing the services in April 2011, but did not stop billing customers for the services until June 2012. Any customer who has been charged for an illegally marketed add-on product, or charged interest and/or fees because of the charge, is due a refund.
In addition to being signed up for services over the phone, instead of in writing as is required, some customers did not even receive the benefits of the credit monitoring service they thought they were signing up for. The service was supposed to provide monitoring of consumers’ credit report and alert them to any potentially fraudulent activity; instead customers were charged before any monitoring actually took place.
The list of violations of which Chase was found guilty includes charging customers for services they didn’t receive, charging interest and fees on top of the original unfair charges and failing to deliver the promised products. The add-on credit monitoring service fees were between $7.99 and $11.99 per month, and some customers were charged these fees for years without getting any benefits.
Chase customers who are due refunds need not do anything to file a claim or get the reimbursement. If they have not yet received a check, it should be on the way soon.