The Consumer Financial Protection Bureau isn't really content to sit tight. The bureau has passed new regulations and started waging suits against financial providers that run afoul of consumer protection laws, with charge card businesses being the very first in the firing line. After winning lawsuits against Discover and Capital One, American Express is the most recent to settle with the CFPB, along with other agencies, and has decided to refund $85 million to customers.
Many other card corporations in court
The main goal of the Consumer Financial Protection Bureau is to protect consumers from financial services, but that does not just include creating brand new legislation. In fact, a lot of financial service providers are dealing with lawsuits for breaking regulations associated with other agencies.
The first Consumer Financial Protection Bureau targets have definitely been credit scar companies. Over $200 million in settlements, mostly cash going to customers have been made in suits with Discover and Capital One already, according to NBC News.
American Express has just settled a comparable lawsuit, brought by the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Company, the Federal Reserve, and, according to CBS, regulators from the state of Utah.
Giving a ton to consumers
In the lawsuit, American Express is alleged to have broken numerous laws. The charge card business was accused of discriminating against applicants over 35 years of age, making false claims about charge card rewards, charging late charges over legal limits and failing to report billing disputes to credit reporting organizations, a violation of regulations regarding debt collection and reporting.
The charge card business is ordered to pay $27.5 million in fines and $85 million back to consumers in a refund.
The brouhaha over late fees, according to CBS, was due to charging late charges based 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 customers who were approved for an American Express "Blue Sky" card, which some consumers never received.
Age was a huge factor in the credit scoring system at American Express Centurian Bank. That is not legal because it is considered discrimination.
Looking at debt practices
Some consumers were promised that they would have an increased credit rating if they paid off debts older than 7 years, which do not affect credit ratings 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.
There are about 250,000 people who will obtain part of the $85 million allotted to concessions. They should, according to NBC News, get it in March 2013.
Many other card corporations in court
The main goal of the Consumer Financial Protection Bureau is to protect consumers from financial services, but that does not just include creating brand new legislation. In fact, a lot of financial service providers are dealing with lawsuits for breaking regulations associated with other agencies.
The first Consumer Financial Protection Bureau targets have definitely been credit scar companies. Over $200 million in settlements, mostly cash going to customers have been made in suits with Discover and Capital One already, according to NBC News.
American Express has just settled a comparable lawsuit, brought by the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Company, the Federal Reserve, and, according to CBS, regulators from the state of Utah.
Giving a ton to consumers
In the lawsuit, American Express is alleged to have broken numerous laws. The charge card business was accused of discriminating against applicants over 35 years of age, making false claims about charge card rewards, charging late charges over legal limits and failing to report billing disputes to credit reporting organizations, a violation of regulations regarding debt collection and reporting.
The charge card business is ordered to pay $27.5 million in fines and $85 million back to consumers in a refund.
The brouhaha over late fees, according to CBS, was due to charging late charges based 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 customers who were approved for an American Express "Blue Sky" card, which some consumers never received.
Age was a huge factor in the credit scoring system at American Express Centurian Bank. That is not legal because it is considered discrimination.
Looking at debt practices
Some consumers were promised that they would have an increased credit rating if they paid off debts older than 7 years, which do not affect credit ratings 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.
There are about 250,000 people who will obtain part of the $85 million allotted to concessions. They should, according to NBC News, get it in March 2013.
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