HSBC Holdings Plc was sued by United States customers who claim that the bank had violated the credit-card payment-protection rights of disabled, unemployed and retired clients.
The many complaints that have been filed against the HSBC Holdings Plc last July in Camden, New Jersey and Philadelphia federal courts pointed out that even though the credit-card payment-protection service may be able to safeguard customer accounts by cancelling or suspending the required minimum payments when their clients become unemployed or disabled. Unfortunately, the circumstances that triggers the account protections are too complicated, varied, and are always changing.
The complaints also pointed out that this payment protection scheme was made to take advantage of financially insecure customers, and that this service is virtually worthless due to the various restrictions that have been imposed on it. These restrictions are sent to clients after enrolling them, and they are shown in small print that are hard to read and decipher, and that these small print restrictions are also incomplete and are even misleading.
The bank's customers also added that this credit-card payment-protection plan excludes people who are self-employed, part-timers, disabled, unemployed, and retired. They also added that the bank had also failed to inform them about this exclusion beforehand. The plan costs about $1.35 for each $100 of a client's credit card balance at the end of the month.
HSBC has yet to comment on this issue and does not comment on these kinds of legal matters, according to the bank's spokesperson in London Kate Durham.
The complaint that had been filed in Camden, New Jersey was made by Marilyn Rizera, and it further states that the HSBC Card Services Inc. and the HSBC Bank USA Inc. have breached their contract and violated the New Jersey Consumer Fraud Act.
Rizera, who is 54 and is disabled and had never held a job before, also stated in her complaint that the HSBC had never inquired about her disability or employment status before they enrolled her. The complaint also pointed out that, even though she is practically ineligible to have the benefits of the credit-card payment-protection plan, she is still charged for the payment protection service in her credit card account every month.
Meanwhile, the complaint that had been filed in Philadelphia was made Edward T. Esslinger, Adrath Rogers, and Gloria Glover who stated that the HSBC have violated the Pennsylvania Unfair Practices and Consumer Protection Law.
HSBC Holdings Plc is the largest lender in Europe by market value, and is also one of the most prominent banks in London. The bank had also grown to be the biggest financial and banking services in the world this year, and it had become the 8th largest company in the world as stated by Forbes magazine.