Discover Card will refund $200 million to customers
The credit card company will be issuing refunds to customers who purchased certain products sold by telemarketers.
Tue, Sep 25 2012 at 2:00 PM
Personal finance guru
Dave Ramsey is not a fan of credit cards and can often be heard calling credit card companies “snakes” — as the old adage goes, if you play with snakes, you’re going to get bit. More than 3.5 million Discover Card account holders that were bit by pushy telemarketers between December 2007 and August 2011 may be receiving a refund once a $200 million agreement is finalized.
Discover Bank reached an agreement with the Federal Deposit Insurance Corporation (FDIC) and the Consumer Financial Protection Bureau (CFPB) to provide customers with $200 million in refunds and pay separate civil penalties of $14 million.
The settlement focuses on the deceptive use of language by telemarketers selling add-on programs including Payment Protection, Credit Score Tracker, Identity Theft Protection and Wallet Protection. The CFPB found that the scripts used by telemarketers were unclear and the use of deceptive language led to several issues including:
Consumers were misled about the fact that there was a charge for the products
Consumers were misled about whether they had actually purchased the products
Some consumers were enrolled without their consent
Eligibility requirement information was withheld from consumers
In addition to the financial settlement, Discover Financial Services is ordered to stop its deceptive marketing practices and submit to an independent audit to verify compliance with the settlement order.
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