The Consumer Financial Protection Bureau has gone on a bit of a tear with suits against credit card businesses, nailing Discover and Capital One earlier this year. American Express has joined the ranks, settling a suit with the CFPB and other agencies and agreeing to refund $85 million to consumers.
Consumer Financial Protection Bureau not pleased with charge card companies
The main goal of the CFPB is to guard customers from financial services, but that does not just include creating new legislation. In fact, a bunch of financial service providers are dealing with lawsuits for breaking regulations associated with other organizations.
The first CFPB targets have definitely been credit scar companies. Over $200 million in settlements, mostly cash going to consumers have been made in suits with Discover and Capital One already, according to NBC News.
American Express has just settled a similar lawsuit, brought by the CFPB, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Business, the Federal Reserve, and, according to CBS, regulators from the state of Utah.
Customers get fast cash
American Express is in trouble for breaking multiple laws, including failing to report billing disputes and regulations about debt collection and reporting. It also charged late fees over legal limits and made false claims about rewards. Also, applicants over the age of 35 were discriminated against.
A refund will be required for $85 million from American Express. The company will even be paying $27.5 million in fines for the problems.
The brouhaha over late fees, according to CBS, was due to charging late charges depending on a percentage but, according to CNN, subsidiaries American Express Centurian Bank and American Express Bank set the rate in excess of already established limits. American Express Centurian Bank also offered $300 to qualified consumers who were approved for an American Express "Blue Sky" card, which some consumers never received.
Though it is technically discrimination, one of the subsidiaries was using a credit scoring system that was depending on age.
Looking at debt procedures
Some customers were promised that they would have an increased credit rating if they paid off debts older than 7 years, which do not affect credit scores at all. CBS explained that his has happened since 2003 and still happened this year. The lies were being told at American Express, American Express Bank and American Express Centurian bank.
According to NBC News, 250,000 people will get part of the $85 million in concessions. This will happen in March 2013.
Consumer Financial Protection Bureau not pleased with charge card companies
The main goal of the CFPB is to guard customers from financial services, but that does not just include creating new legislation. In fact, a bunch of financial service providers are dealing with lawsuits for breaking regulations associated with other organizations.
The first CFPB targets have definitely been credit scar companies. Over $200 million in settlements, mostly cash going to consumers have been made in suits with Discover and Capital One already, according to NBC News.
American Express has just settled a similar lawsuit, brought by the CFPB, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Business, the Federal Reserve, and, according to CBS, regulators from the state of Utah.
Customers get fast cash
American Express is in trouble for breaking multiple laws, including failing to report billing disputes and regulations about debt collection and reporting. It also charged late fees over legal limits and made false claims about rewards. Also, applicants over the age of 35 were discriminated against.
A refund will be required for $85 million from American Express. The company will even be paying $27.5 million in fines for the problems.
The brouhaha over late fees, according to CBS, was due to charging late charges depending on a percentage but, according to CNN, subsidiaries American Express Centurian Bank and American Express Bank set the rate in excess of already established limits. American Express Centurian Bank also offered $300 to qualified consumers who were approved for an American Express "Blue Sky" card, which some consumers never received.
Though it is technically discrimination, one of the subsidiaries was using a credit scoring system that was depending on age.
Looking at debt procedures
Some customers were promised that they would have an increased credit rating if they paid off debts older than 7 years, which do not affect credit scores at all. CBS explained that his has happened since 2003 and still happened this year. The lies were being told at American Express, American Express Bank and American Express Centurian bank.
According to NBC News, 250,000 people will get part of the $85 million in concessions. This will happen in March 2013.
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