I’ve talked about the CFPB (Consumer Financial Protection Bureau) in the past. In short, this is a new(ish) federal agency that is supposed to act as a watchdog for consumer financial products.
Well… Earlier this week they delivered a financial smack down to Capital One for deceptive marketing practices related to the sale of various credit-related products. They’re being forced to refund close to $150M to consumers, pay a $25M fine to the CFPB, and pay an additional $35M to the Office of the Comptroller of the Currency (OCC).
Among other things, customer service reps reportedly sold “payment protection” plans (which cover your payment if you become sick or unemployed) to people who were already sick or unemployed, such that they’d never be able to collect on their claims. They were also cited for violations related to credit monitoring and ID theft services.
All in all, I’m happy to see the CFPB starting to take action against corporations that engage in sketchy practices. That being said, there are a huge number of financial services companies out here. Will the CFPB be able to keep them in line? Only time will tell.