Capital One Bank is being fined by the Consumer Financial Protection Bureau for forcing and swindling two million customers into purchasing extra products when they opened credit card accounts.
The bank will be forced to give back close to $140 million to customers and pay an extra $25 million fine to the CFPB for using dishonest advertising on customers.
Capitol One will also pay the Office of the Comptroller of the Currency a fine of $35 million and refund another $10 million to customers for not providing them with programs that would warn them of such deceptive practices. The bank's total payment when both actions are put together equals up to $210 million.
"We are accountable for the actions that vendors take on our behalf," said Ryan Schneider, president of Capital One's card business, to the Wall Street Journal. "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."
The CFPB has accused Capital one of misleading customers into purchasing "add-on products" such as credit monitoring and payment protection upon beginning services with the credit card lender.
The CFPB says that customers with low credit scores and low credit limits were made to believe that their credit could be improved with the extra features. They were also told that buying the features was mandatory. Other consumers were placed into the program without even giving Capital One permission to do so.
The CFPB said customers who had the program as an added feature to protect payments or monitor their credit on or after August 1, 2010 will be given their money back and will be repaid finance charges as well as over-the-limit fees or interest.
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