Archive for 'Capital One'

CFPB’s First Major Enforcement Action Targets Capital One

Thursday, August 16th, 2012 at 5:15 am  
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Last month, the Consumer Financial Protection Bureau made a big splash with its first enforcement action. Charging that Capital One engaged in deceptive marketing and credit card practices, the CFPB and the Office of the Comptroller of the Currency entered into a settlement with the financial services company for $210 million.

According to a CFPB press release, the CFPB alleged that Capital One’s telemarketers deceptively sold add-on products such as payment protection and credit monitoring. The settlement requires Capital One to refund $140 million to two million Capital One customers who were pressured into buying the add-on products, to pay a $25 million penalty to the CFPB’s Civil Penalty Fund, $10 million in restitution to customers harmed by unfair billing practices, and an additional $35 civil penalty. In addition, Capital One agreed to end deceptive marketing and work with an independent auditor to assure compliance.

Capital One on the Hook for $12 Million to Servicemembers

Thursday, August 2nd, 2012 at 2:02 pm  
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Bloomberg reports that Capital One entered into an agreement with the Justice Department and the Comptroller of the Currency to pay $12 million to servicemembers for alleged violations of the Servicemembers Civil Relief Act (SCRA). The bank, which didn’t admit to any wrongdoing, agreed to pay $7 million to servicemembers who had their vehicles repossessed or their homes foreclosed upon, as well as $5 million to those whose interest rates on car loans and credit cards weren’t lowered in accordance with the SCRA. This follows on the heels of a 2011 settlement with Bank of America for $20 million.

The SCRA provides financial protection to active duty servicemembers whose ability to pay is impacted by their service to our country. The SCRA calls for reducing the interest rate on high-interest loans to six percent, preventing vehicle repossession, preventing foreclosure on homes and storage units. It also affords protections for vehicle and equipment leasing, default judgments, and pay garnishment. For more information, visit http://stopcollector.com/servicemembers-civil-relief-act.

Consumer Cannot Get Accounting from Capital One Debt Collector

Thursday, June 7th, 2012 at 2:54 pm  
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According to a report in the Star-Ledger, a New Jersey woman has been paying on a debt that should have been paid off by now, but a debt collection agency for Capital One won’t account for the money. The consumer found out last November that Eichenbaum & Stylianou had gotten a court judgment against her totaling $1,286.55. She offered to pay $100 per month, but the debt collection agency said that wasn’t enough. She made monthly $100 payments to the court, and the debt collector garnished her wages for $169.03 every two weeks.

In a case of the right hand not knowing what the left hand is doing, one court department accepted the consumer’s payments while another tracked her wage garnishments. In the meantime, Eichenbaum & Stylianou wouldn’t give her an accounting of the payments she’d made, nor the balance due. A consumer advocate at the Star-Ledger called the debt collection agency, which told her that the debt was in the process of being sold to another debt collector, so they couldn’t retrieve a current account statement. Ultimately, the reporter spoke to an officer of the court, who said that it was up to the debt collector to provide the consumer with information about what she owes and to halt the wage garnishments when the debt is paid off.

The most interesting twist is that the reporter discovered that the Fair Debt Collection Practices Act doesn’t require that a debt collector update the consumer’s outstanding balance, and that it’s up to individual state law to address that issue. New Jersey’s state law doesn’t cover it, and we suspect that most state laws fail to hold debt collectors accountable.

Hawaii AG Files Suit Against Credit Card Companies

Friday, April 13th, 2012 at 1:59 pm  
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Hawaii Attorney General David Louie filed suit against seven credit card companies for alleged improper charges. The suit alleges that Hawaiians were charged for products they didn’t order – such as payment protection plans – or products that didn’t match the claims that were made. According to Attorney General Louie’s press release, the defendants in the suit are Bank of America, Barclays, Capital One, Chase, Citi, Discover, HSBC, and their subsidiaries.

The lawsuit is asking for an injunction to halt the practices, as well as restitution and penalties that could amount to $10,000 per violation. Hawaiians who believe they have been victims of the alleged fraud should contact Rick Fried at 808-524-1433.

West Virginia AG Settles with Capital One

Wednesday, January 18th, 2012 at 8:21 pm  
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West Virginia Attorney General Darrell McGraw announced a settlement in the state’s case against Capital One and its sister companies. The case related to the lender’s credit card practices prior to January 1, 2006. Although the settlement means that Capital One does not have to admit to any wrongdoing, the financial institution is ponying up $13.5 million. According to a press release issued from McGraw’s office, “Capital One agrees to provide $3 million in debt forgiveness to West Virginia consumers, $9.5 million to the State of West Virginia to be used for financial relief for West Virginia consumers, and $1 million to the Attorney General’s office for consumer education and restitution.”

Capital One Resurrects Old Debt

Wednesday, February 2nd, 2011 at 2:20 pm  
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It’s an old ruse, but one that too many consumers seem to fall for. At the Los Angeles Times, David Lazarus reports that Capital One is sending out bills to consumers – even though the debt is past the statute of limitations and Capital One has written it off as uncollectible. In California, the statute of limitations is four years, meaning that, after four years, a debt collector can’t take a consumer to court in order to collect the debt. All too often, though, debt collectors try and convince a consumer to make a single payment. If the consumer pays, this resets the clock and the debt once again becomes current.

Lazarus reports that Capital One said that they were following a federal regulation in sending the notice; our experience is that Capital One and its corporate web of companies often engage in practices that violate the Fair Debt Collection Practices Act. That’s why we have three class action lawsuits against Capital One.

Consumer Sues Capital One for $286 Million

Monday, December 13th, 2010 at 3:13 pm  
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Turnabout is fair play, as they say. According to a report in the Philadelphia Inquirer, Patrice Perry was shocked when she received the latest in a series of debt collection letters – a letter that demanded immediate payment of $286,651,237 on a $4,807 debt. She’d allegedly been subjected to abusive debt collection practices, such as calls to Perry, and her family and friends, despite her attorney’s notification that Capital One communication should come through him. Now, Perry is suing Capital One for $286 million, claiming that the debt collection agency used “terroristic debt collection methods.”

The StopCollector Case Files: Rogers vs. Capital One

Monday, July 12th, 2010 at 5:00 am  
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Over the past few days, we’ve discussed a class action lawsuit being brought by Lemberg & Associates against Capital One Services, NCO Financial Systems, and Capital One Bank. The law firm is also bringing a class action lawsuit against Capital One Services, United Recovery Systems, and Capital One Bank for sending similar letters that are in violation of the federal Fair Debt Collection Practices Act (FDCPA). Like Mr. Wood, Henry Rogers received a letter that he thought was from his creditor, Capital One Bank. Yet calls to the toll-free number were redirected to United Recovery Systems, which is a misleading debt collection practice. In addition, the letter fails to mention that Mr. Rogers has the right to dispute or obtain verification of the debt, which is also a violation of the FDCPA. Similarly, the letter doesn’t clearly state that it’s from a debt collector. Instead, that information is buried on the back of the letter.

The letter was a mass-mailed form letter that offered an annual percentage rate (APR) of 0% if Mr. Rogers agreed to a payment plan, but threatened that his APR would “return to 19.90%” on the entire debt if that agreement was not honored.

If you live in Connecticut and received a letter similar to the one Mr. Rogers received, and would like to join the group of consumers intent on holding Capital One Services, United Recovery Systems, and Capital One Bank accountable for their actions, complete the form here or call .

The StopCollector Files: Class Action in Woods v. Capital One

Sunday, July 11th, 2010 at 5:00 am  
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Yesterday we gave you an overview of the ways in which Gareth Wood was victimized by Capital One Services and NCO Financial Systems on behalf of Capital One Bank. Essentially, when they sent Mr. Wood a “Pre-Legal Notice,” these debt collectors violated the Fair Debt Collection Practices Act (FDCPA) in a number of ways.

Lemberg & Associates is in the process putting together a class action lawsuit for these violations. Why a class action suit? Because it appears as though the letter Mr. Wood received was a form letter. This form letter is likely to have been mass-mailed to thousands of consumers whose accounts are past due. When a situation like this arises, it’s impractical to expect every single consumer to hire a fair debt attorney and individually obtain justice. Class actions are made available to help consumers get relief when a company injures many people in the same manner.

If you live in New York and received a letter similar to the one Mr. Wood received, and would like to join the group of consumers intent on holding Capital One Services, NCO Financial Systems, and Capital One Bank accountable for their actions, complete the form here or call .

The StopCollector Case Files: Part II

Saturday, July 10th, 2010 at 5:00 am  
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Yesterday, we gave you an overview of Wood v. Capital One. Lemberg & Associates is charging that the letter Mr. Wood received is deceptive and misleading, and therefore violates the federal Fair Debt Collection Practices Act (FDCPA). The FDCPA says that a debt collector can’t falsely represent the character, amount, or legal status of any debt. In other words, declaring that the letter was a “Pre-Legal Notice,” without actually ever intending to take Mr. Wood to court, is a violation. The FDCPA also says that a debt collector can’t use false representation or deceptive means to collect a debt. By making it look as though the letter came from Mr. Wood’s original creditor, Capital One Collections and NCO Collections were acting deceptively.

In addition, the notice didn’t mention Mr. Wood’s right, under the FDCPA, to dispute the debt or to obtain verification of the debt. Plus, the letter didn’t effectively communicate that it was sent by a debt collector (that information was on the back of the letter in fine print) – another FDCPA violation.

Tomorrow, we’ll discuss why Lemberg & Associates is filing a class action lawsuit on behalf of consumers who experienced similar abuses.

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