US BANK based in Minneapolis Minnesota must pay $48 million to more than 400,000 customers who paid for and in some cases did not receive “Privacy Guard” an identity protection and credit monitoring service, this according to a federal regulator at the CFPB.
The Consumer Financial Protection Bureau (CFPB) alleged the “over-charges” happened between 2003-2012. US BANK offered “Privacy Guard” and “Identity Secure” to their credit card and account holders.
US BANK used a third-party vendor “Affinion” to administer “Privacy Guard” and “Identity Secure” As part of their policy, US BANK required written authorization from customers before the services could begin. The problem stems from Affinion, the “third party vendor” apparently not always processing authorizations properly. The CFPB claims that customers were billed as soon as they enrolled.
The long and short of it is that some customers were charged for services they never received. In some cases believing their credit report was being monitored when it was not because the authorization was never received or processed properly. In the worst cases, charges for the services caused some customers to go over the credit limit on their credit card account, in turn leading to “over-limit fees.
In addition to the $48 Million to consumers, US BANK must pay $11 million in penalties to the Consumer Financial Protection Bureau & the U.S. Office of the Comptroller of the Currency.
US Bank terminated its relationship with Affinion nearly two years ago. The bank said, “We will be compensating customers who did not receive full services from Affinion, and providing our apology.”