Saturday, January 10, 2009

CompuCredit must "Comp You Cash"

$114 million refund in pipeline for subprime credit card users - Action Line -

The Miami Herald is reporting today that CompuCredit was ordered to reverse fees it charged customers they secured with deceptive marketing practices.

Those fees total $110.3 million in reversals and $3.7 million in cash refunds. I suppose that's gives a new twist to their "Comp" You Credit branding strategy. Oh, they've got to "comp you cash" if your balance is lower than the the amount they've been ordered to compensate.

Here's the story from the Miami Herald...

CompuCredit, a company marketing Visa and MasterCard credit cards to consumers in the subprime credit market, has agreed to reverse fees charged to eligible consumers' accounts to settle allegations that it violated federal law, according to the Federal Trade Commission. It is estimated that the redress program will result in more than $114 million in credits to consumer accounts.

Eligible consumers whose current balances are less than the amount of credits to be applied will receive an estimated $3.7 million in cash refunds.

In a federal court complaint filed in June 2008, the FTC alleged that CompuCredit engaged in deceptive conduct in connection with marketing credit cards. The FTC also alleged that Jefferson Capital Systems, a debt collection company wholly owned by CompuCredit, engaged in deceptive conduct in marketing credit cards as part of its debt collection activities and engaged in abusive practices while collecting debts.

Eligible consumers will be identified from company records and contacted.

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