Banks Settle with Attorney Generals for $13.5M for Deceptive Credit Card Practices

Banks Settle with Attorney Generals for $13.5M for Deceptive Credit Card Practices

Posted By Golomb & Honik || 26-Feb-2014

Philadelphia-based class action law firm Golomb & Honik, P.C. has announced that JPMorgan Chase and Discover Financial Services have agreed to pay $13.5 million in a settlement to the states of New Mexico, Mississippi, and Hawaii as reparation for the misleading marketing practices used to sell their credit card payment protection plans. Golomb & Honik, P.C. attorneys Ruben Honik, Richard Golomb, Kevin Fay, and Kenneth Grunfeld served with co-counsel and each state’s attorney general in these cases. These settlements come after the resolution of $130 million-worth of class actions with some of the largest credit card companies and banks worldwide.

According to Richard Golomb, managing shareholder of Golomb & Honik and counsel in all of the Attorney General and class action cases, “these settlements send the message to large banks and credit card companies that it is no longer business as usual in the way they take advantage of customers. These Attorneys General recognized that what these corporations were doing was wrong and fought to correct that wrong for their constituents. It was a pleasure working with them.”

JPMorgan Chase will pay $6.9 million and Discover Financial Services will pay $6.6 million. The funds will be divided amongst the three states.

The lawsuit alleged that the financial institutions engaged in deceptive and misleading tactics in order to enroll customers in a protection plan without their knowledge, or for enrolling customers for a monthly fee knowing that the customer would not be able to make a successful claim due to a number of broad exclusions. The banks have denied any wrongdoing.

Other cases against major credit card companies and banks are currently pending.

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