Credit Cards

As a result of today’s order, Discover will pay approximately $200 million in restitution to more than 3.5 million consumers.

How will consumers be refunded?

Anyone affected by this order will automatically receive a credit to their account, or, if they’re no longer a Discover customer, they’ll receive a check in the mail or have any outstanding balance reduced by the amount of the refund.

Consumers don’t need to take any further action to receive their credit or check.

If you have questions about whether you are entitled to a refund, please contact Discover.

As with any time large numbers of consumers get refunds, scammers sometimes pop up. Watch out for anyone who tries to charge you, tries to get you to disclose your personal information, or asks you to cash a check and send a portion to a third party in order to “claim your refund.” It’s a scam. Call us at (855) 411-CFPB.

Since we launched on July 21st 2011, we’ve heard directly from consumers about the challenges they face in the marketplace, brought their concerns to the attention of financial institutions, and helped address their complaints. Accepting, resolving, and analyzing consumer complaints is an integral part of our work.

Periodically, we’ll feature stories from consumers who we have helped, and who have agreed to let the CFPB make their stories public.

Jonna, a 53-year-old legal assistant from Texas, was accruing high fees on her credit card because of a card issuer computer glitch.

The problems started in August 2011 when Jonna says she tried to pay $200 toward her $3,100 credit card debt but a malfunction of the credit card issuer’s website instead caused a $3,100 withdrawal from her bank account. That malfunction resulted in an overdraft charge from her bank and a charge of $25 from the card issuer for a bounced payment.

After repeated phone calls to customer service, the card issuer finally straightened out the amount that Jonna had wanted to pay but accidentally put the $3,100 balance as cash advance charges, which have a higher interest rate than purchases. Interest owed was ratcheting up fast. The fees grew to $345 before the issuer agreed to return the balance to the purchased category.

When Jonna contacted the CFPB in May 2012 she says there was still an erroneous cash advance balance on her card, extra fees were still being charged, and the issuer still had failed to reimburse her for the mistaken interest charged while the balance was in the higher-interest cash advanced category. Within a week after the CFPB got involved, the credit card issuer corrected all their errors. And, although the issuer could not refund Jonna for the insufficient fund charges from her bank, it sent Jonna a gift card for a national retail outlet.

Learn more

To see more about how we handle consumer complaints, read our Consumer Response Snapshot and to see all credit card complaints, visit our consumer complaint database.

Since we launched on July 21st 2011, we’ve heard directly from consumers about the challenges they face in the marketplace, brought their concerns to the attention of financial institutions, and helped address their complaints. Accepting, resolving, and analyzing consumer complaints is an integral part of our work.

This week, we’ll be featuring stories from consumers who we have helped, and who have agreed to let the CFPB make their stories public.

Ronald, a 77-year-old Army veteran and retired businessman from Georgia believed he had paid off his mortgage but found his mortgage servicer said he still owed money.

Ronald, who bought his home in 1979 for $38,000, was blind and had trouble finding the paperwork to prove he owned his home free and clear. So he continued to hand over $100 each month to the lender. After the CFPB got involved at the end of 2011, the bank determined that Ronald had in fact paid off his mortgage in 2007 before the current servicer took over the loan. The bank refunded Ronald’s money at 3 percent interest and sent him a check for $30,000.

Nelda, a 67-year-old data entry clerk from California, received a $2,000 charge on her credit card for purchases she never made.

She says she contacted the card issuer to report the mistake and found out the charges were systematically accrued on one day by someone withdrawing $200 at a time. She told the issuer it was fraud. But she says the issuer said she was still on the hook for the money because it was her card. The charges set off a cascade of bad events for Nelda that lasted nearly a year. Eventually, the debt was sold to a collection agency that took Nelda to court.

After the CFPB got involved, the card issuer accepted that the charges were fraudulent and agreed that Nelda was not responsible.

Learn more

To see more about how we handle consumer complaints, read our Consumer Response Snapshot and to see all credit card complaints, visit our consumer complaint database.

When you’re activating a new credit card, watch for “the pitch.”

When you call to activate a new credit card, you may be routed to representatives who try to sell you things like “credit protection” or “identity monitoring” to add to your account. These services, or “add-on products,” are additional, optional services that will cost you money. You don’t have to buy anything extra from the credit card company to activate your credit card. In some cases, the sales tactics may be high-pressure and confusing.

Some things to ask yourself when you’re deciding whether you want add-on products:

• Do you have enough information about the service to buy it?
• Is the cost worth the possible benefit?
• Do you understand whether you’d be eligible for the benefits of the service?

When you’re checking your monthly statement, watch for unfamiliar terms or fees.

Even if you don’t recall signing up to buy an extra service, be vigilant about checking your credit card statement for anything unfamiliar, including “add-on,” optional, fee-based products.

If you want to cancel these services

Call your credit card provider by using the number on the back of your card and ask to cancel them. You are not required to buy these optional services from your credit card provider.

What to do if this happens to you

If you find unfamiliar fees on your credit card statement, here’s what you should do:

• Call your credit card company using the phone number on the back of your card to try to resolve the problem. Tell the card company if you did not authorize the charge.
• Tell your story so that we can track what’s happening in the marketplace
• If you’re unable to resolve the issue, file a complaint with the CFPB
• Ask CFPB if you have more questions about credit cards.

Today marks a major step forward in our work to protect consumers. In a first by a federal financial regulator, the Consumer Financial Protection Bureau (CFPB) will share with the public individual-level consumer complaint data received by the CFPB.

Check out the Bureau’s policy statement for more details.

What does this mean for consumers?

No longer will consumer complaints only be known to the individual complainant, bank, regulator, and those in the public willing to pursue this information through the Freedom of Information Act. Instead this data-rich window into consumer financial issues will be widely available to everyone: developers, policymakers, journalists, academics, industry, and you. Our goal is to improve the transparency and efficiency of the credit card market to further empower American consumers.

And just to be clear, no personally-identifiable information, such as a consumer’s name, credit card number, or mailing address will be made available via the Consumer Complaint Database.

The Bureau’s Consumer Response function receives consumer complaints on a wide variety of products including credit cards, mortgages, student and other consumer loans, and other bank products (such as checking and savings accounts). And while the Consumer Complaint Database initially will contain only credit card complaints, the Bureau is proposing to extend the Database to all other consumer financial products and services covered by the CFPB.

What happens when a consumer files a complaint?

When a consumer files a complaint, Consumer Response intake specialists review each one for completeness, jurisdiction, and non-duplication. Complaints that meet these criteria are then forwarded to the appropriate company (bank or nonbank) for review and resolution. Companies are given 15 days to provide a substantive response to each consumer complaint, and are expected to resolve and close all but the most complicated complaints within 60 days.

Consumer Response prioritizes for investigation certain complaints based on a handful of risk-based criteria including the failure of a company to respond in a timely manner and those in which the consumer disputes the company-provided resolution. When potential legal violations are detected, Consumer Response works closely with other parts of the Bureau including the offices of Supervision, Enforcement, and Fair Lending to ensure potential violations are dealt with appropriately.

Throughout this process, consumers have the ability to log into the CFPB’s website to check the status of their complaint (and, when appropriate, dispute the resolution provided by the financial institution).

Why beta?

Today, we’re releasing the beta version of the Consumer Complaint Database. Why beta? While the complaint information in the database is actual data, the functionality, data fields, and “look and feel” of the database are all in the beta stage of development. In other words, this version of the Consumer Complaint Database is only the beginning. In addition to potentially enlarging the Database to include all other consumer financial products and services covered by the Bureau, we are looking into potentially expanding it in a number of other ways. These include the possible addition of narrative fields (to the extent we can do so while protecting personally-identifiable information), more sub-product and sub-issue data fields, regular and normalized data visualizations, and expanded data tools.

Lastly, you will note that initially the Database only contains complaints received by the CFPB on and after June 1st. Additional retroactive data will be added when we remove the “beta” tag later this summer.

What do you think?

We encourage you to tell us what you think about the Consumer Complaint Database by telling your story. All comments and suggestions are welcome.

Scott Pluta is the Chief of Staff and Acting Assistant Director for Consumer Response at the Consumer Financial Protection Bureau.

We all make mistakes. That’s part of what makes us human. When we can, we learn from our mistakes. That’s why we at the Consumer Financial Protection Bureau want to understand more about the most common errors consumers make about money. We want to find better ways to help others avoid these mistakes in the future.

For example, many consumers make credit card and loan decisions without shopping for the best rates and terms. Others set goals – like saving more for retirement or for the down payment on a home – but don’t follow through. Many people live paycheck-to-paycheck, but never take the steps necessary to plan their spending, reduce their debt, or save for sudden expenses.

We would like to give you a chance to tell us about common money mistakes. Tell us about:

• Errors you’ve made;
• Mistakes you’ve seen others make;
• Habits and practices that make good choices more difficult; and
• What you wish you had known sooner or would do differently next time.

Please e-mail your comments to FinancialEducation@CFPB.gov.

(Note: Do not discuss personally identifiable information or private issues in the comments area below. If you have a complaint about a specific product or company, please enter it here.)