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.