U.S. Bank Ordered to Refund Millions - Legal News


Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Legal » U.S. Bank Ordered to Refund Millions

U.S. Bank Ordered to Refund Millions

U.S. Bank Ordered to Refund Millions
Tags: , , ...
The content is accurate at the time of publication and is subject to change.

U.S Bank will be refunding an estimated $48 million to consumers in the newest round of settlements by banks due to illegal practices. The Minneapolis-based bank was found to have billed customers for identify protection and credit monitoring services which they never delivered.

The announcement came from the Consumer Financial Protection Bureau (CFPB) indicating that the bank will be making restitution to 420,000 customers, who signed up for Privacy Guard and Identity Secure.  Customers believed that their accounts were being monitored when they weren’t. Current customers will receive a credit to their account, while others will get a check in the mail for their portion of the settlement.

U.S Bank will also be paying a $5 million civil penalty to the CFPB, as well as an additional $4 million penalty to the Office of the Comptroller of the Currency (OCC), a treasury agency which oversees national banks.

They are not alone. Bank of America, Chase, Discover, American Express and Capital One have all been sanctioned by the CFPB for similar offenses in the past. “We have consistently warned companies about practices related to add-on products and we will do what is necessary to prevent further harm to consumers,” said CFPB Director Richard Cordray.

A third party no-no

Privacy Guard and Identity Secure were administered for U.S Bank by a third-party vendor who registered customers into the programs for credit cards and other banking services including mortgage accounts.

As part of the sign-up process they needed to acquire the customers’ written consent, which was not done in some cases.  People were billed as soon as they agreed to the service, but before they actually signed and returned the consent forms. Some individuals were billed for years.

More than just penalties

As part of the agreement with CFPB, U.S Bank must end their illegal billing practices and institute protocols to ensure that going forward this does not happen again. They are also required to beef up their management of third party vendors who handle add-on products and services.

The Consumer Financial Protection Bureau (CFPB) was given the authority to investigate these kinds of issues when the Dodd-Frank Wall Street Reform and Consumer Protection Act was passed. It gave them the ability to take action when companies and institutions take part in practices that are deceptive, abusive or unfair.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

Credit Card Issuers Get a Break from the Feds
Credit Card Issuers Get a Break from the Feds

Posted: April 17, 2015

The Consumer Financial Protection Bureau (CFPB) has temporarily suspended a rule requiring credit card companies to submit their consumer agreements to the Bureau each quarter. Continue reading

The CFPB Cracks Down on an Illegal Debt Collection Lawsuit Mill
The CFPB Cracks Down on an Illegal Debt Collection Lawsuit Mill

Posted: December 31, 2015

The Consumer Financial Protection Bureau wants to bar the Frederick J. Hanna & Associates and its three partners from continuing to engage in illegal debt collection practices. Continue reading

New Credit Cards From Peoples Bank
New Credit Cards From Peoples Bank

Posted: November 03, 2015

People’s United Bank and Elan Financial Services have rolled out six new credit cards including the World Elite, World Bonus Rewards, World Bonus Rewards PLUS, Platinum, College and Secured cards. Continue reading

Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com and more up to the quarterly maximum, each time you activate.
For Excellent, Good Credit
INTRO OFFER: Discover will match ALL the Miles you've earned at the end of your first year, automatically. For example, if you earn 30,000 Miles, you get 60,000 Miles. That's $600 towards travel!
For Excellent, Good Credit
Earn unlimited 1.5% cash back on every purchase, every day
For Average, Fair, Limited Credit
You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!