Got a Capital One credit card? Then you might want to check out some news that affects borrowers who have cards with the company.
If a Capital One credit card is what’s in your wallet, then you may be covered under a new class-action settlement concerning the bank’s business practices. Capital One has reached a settlement with banking regulators (which we apparently have!) to pay $60 million in damages, and a further $150 million to Capital One credit card holders after the company admitted some “deceptive marketing and billing practices,” mostly concerning third-party vendors.
Chances are, you’ve already encountered some of the practices that Capital One credit card users experienced and the company later got into trouble for inadvertently (or perhaps knowingly) exposing their customer base. It appears third-party, post account-opening offers and deals for services of dubious value such as “credit protection” are at the heart of the issue, and now the company has to pay up in the settlement.
Capital One credit card business president Ryan Schneider commented on the settlement, saying that the bank was indeed “inconsistent” with regulation. He said:
“We are accountable for the actions that vendors take on our behalf… These marketing calls were inconsistent with the explicit instructions we provided to agents for how these products should be sold. We apologize to those customers who were impacted and we are committed to making it right.”
Kent Markus of the newly-created Consumer Financial Protection Bureau explains that the onus is on the company to get the funds to entitled Capital One credit card holders:
“Customers do not have to opt in to this… They are in automatically. Cap One has to identify the customers.”
Capital One notes that the average refund to cardholders should be less than $100, and will automatically appear on statements.
Capital One has a new slogan – – What’s in your wallet? Nothing, we took it all. Sorry pal, you’re screwed. #LenoMono bit.ly/MdQ0Lg
— Jay Leno (@jayleno) July 20, 2012