CFPB Orders GE Capital to Pay $225 Million for Deceptive and Discriminatory Practices
The Consumer Financial Protection Bureau (CFPB) is ordering GE Capital Retail Bank, now known as Synchrony Bank, to provide an estimated $225 million in relief to consumers harmed by illegal and discriminatory credit card practices.
GE Capital must refund $56 million to approximately 638,000 consumers who were subjected to deceptive marketing practices. As part of the joint enforcement action by the CFPB and Department of Justice, GE Capital must also provide an additional $169 million to about 108,000 borrowers excluded from debt relief offers because of their national origin.
This order represents the federal government's largest credit card discrimination settlement in history.
"Today's action will provide $225 million in relief to GE Capital credit card customers who were harmed by deceptive marketing or discrimination," said CFPB Director Richard Cordray. "We will continue to take action against marketing tactics that trick consumers into buying credit card products they do not want or cannot use. Consumers also deserve to be treated fairly no matter where they live or what language they speak."
"The blatant discrimination that occurred here is unlawful and will not be tolerated. Borrowers have the right to credit card terms that do not differ based on their national origin, and the settlement today sends the message that the Justice Department can and will vigorously enforce the law against lenders who violate that right," said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division of the Department of Justice.
Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has the authority to take action against institutions engaging in unfair, deceptive, or abusive practices. The ECOA authorizes the CFPB and the DOJ to take action against creditors engaging in illegal discrimination. The CFPB is issuing a consent order as an administrative action covering both the deceptive marketing practices and the illegal discrimination. The DOJ's settlement on discrimination was filed in the U.S. District Court for District of Utah.
Find out more about the enforcement action against GE Capital at ConsumerFinance.gov.
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