Hawaii’s attorney general has filed a lawsuit against seven of the
largest credit card companies in the U.S., claiming that they are wrongfully
charging customers for payment protection plans without their consent.
It is estimated that more than 30,000 Hawaii residents pay a monthly fee
intended to ensure their credit card company will either cover or delay
their payments in case of job loss, injury, or some other inability to work.
Bank of America, Capital One, Barclays, Discover, Citi, and HSBA have a
history of deceptive and unethical trade practices, according to the Hawaii
The companies are accused of using telemarketers to trick customers into
signing up for payment protection in a practice called “slamming.”
Because these charges were so small, often only one percent of a consumer’s
credit card bill, they often went unchecked and unnoticed.
Furthermore, payment protection plans don’t apply to people who work
part-time, are employed by members of their family, the unemployed, or
retirees. According to Honolulu attorney Rick Fried, these banks have
been preying on people who are most concerned about their financial status
and who are most likely to sign up. And, companies allegedly even keep
collecting money from customers who are ineligible for coverage.
The state of Hawaii has said that companies are liable for millions of
dollars in penalties. If successful, those funds will end up in the state’s
general fund and in the pockets of consumers who were tricked out of their money.
If you are a Hawaii resident who believes you have been tricked by your
credit card company into signing up for a protection plan, you can call
your Attorney General’s office at (808) 586-1500.
The state of Hawaii is being co-represented by Rick Fried’s firm
as well as Golomb & Honik, P.C. of Philadelphia and Baron and Budd
of Dallas. All firms are working on a contingency fee basis and will be
paid depending on how much money is obtained from the credit card companies