Discover Ordered To Repay $200 Million It Stole From Cardholders

Kudos to Obama’s newly formed Consumer Financial Protection Bureau for cracking down on this. In short, Discover’s telemarketers offered customers unnecessary “add-on services” which were implied to be free, and then charged customers’ accounts for said services. In July, Capital One was forced to pay $210 million over the same practice. The Los Angeles Times reports:

More than 3.5 million Discover credit card customers will share $200 million in refunds in the wake of a federal investigation that determined the bank tricked people into signing up for payment protection plans and other add-on services. Regulators said scripts for Discover’s telemarketers “contained misleading language likely to deceive consumers about whether they were actually purchasing a product.”

Consumer advocates said the enforcement actions show that the new consumer bureau is on the job. “Banks have been doing this for years, but we never had a regulator who protected consumers before,” said Ed Mierzwinski, director of the consumer program for the U.S. Public Interest Research Group.

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  • alienchow

    I bet Discover didn’t pony up a big campaign contribution. How about all the Wall Street swindling? Sub prime mortgage securities being listed as AAA, as an example? Oh yeah, they get bailouts. Please, this is a fucking joke. Throwing a bone before the elections. Pathetic.

  • alienchow

    I bet Discover didn’t pony up a big campaign contribution. How about all the Wall Street swindling? Sub prime mortgage securities being listed as AAA, as an example? Oh yeah, they get bailouts. Please, this is a fucking joke. Throwing a bone before the elections. Pathetic.

  • Apathesis

    CapitalOne offers CreditInform, which supposedly protects your card and gives you updates on your credit score.  Of course, the person at CapitalOne assured me several times it was free, yet I discovered almost six months later it was not.  I later found out that CreditInform is a third party and is not part of CapitalOne, which makes getting a refund a pain in the ass.

  • http://buzzcoastin.posterous.com BuzzCoastin

    If you have a credit card you’re a host to a parasite.
    Why would you not expect the Banksters to NOT act like a parasite?

    Hope all the victims enjoy their $57 provided by Uncle Fed.

  • kowalityjesus

    I have no idea how Discover credit cards stay in business.  I know exceedingly few places that will accept those cards.  Unless this is a desperate measure to stay in business, which I think it is really definitely not (just standard sleazy banking) it absolutely boggles my mind to think how profitable an entity like Visa is.  Maybe one day if I pay all my bills on time I can join their Platinum Usury club.

  • kowalityjesus

    I have no idea how Discover credit cards stay in business.  I know exceedingly few places that will accept those cards.  Unless this is a desperate measure to stay in business, which I think it is really definitely not (just standard sleazy banking) it absolutely boggles my mind to think how profitable an entity like Visa is.  Maybe one day if I pay all my bills on time I can join their Platinum Usury club.

  • Simiantongue

    If I were to steal like that I’d spend the rest of my days in prison. Corporations are not only people they’re privileged people apparently. 

  • Simiantongue

    If I were to steal like that I’d spend the rest of my days in prison. Corporations are not only people they’re privileged people apparently. 

  • Simiantongue

    If I were to steal like that I’d spend the rest of my days in prison. Corporations are not only people they’re privileged people apparently. 

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