Discover Bank will refund customers $200 million to settle charges by the federal government that the credit-card company practiced deceptive marketing.
Federal Deposit Insurance Corp. (FDIC) and Consumer Financial Protection Bureau (CFPB) say the settlement affects 3.5 million customers who signed up for Discover’s add-on credit-card features.
According to FDIC and CFPB, Discover telemarketers failed to disclose eligibility requirements and fees properly when Discover tried to sell credit-score monitoring, identity-theft monitoring and payment-protection services to its customers. In some cases, telemarketers would add these features to a customer’s account without the customer’s consent.
Customers who were charged for one or more of these products from Dec. 1, 2007, to Aug. 31, 2011, will receive a refund for what they were charged, and the refund will be credited to their Discover account. Consumers who no longer are Discover customers will receive a refund check in the mail.
In July 2012, CFPB also ordered Capital One to refund its customers for marketing its services deceptively.