The nation’s consumer watchdog on Wednesday delivered its first enforcement action against the financial industry, fining Capital One for pressuring and misleading more than two million credit card customers.
Capital One, one of the nation’s biggest banks and credit card lenders, agreed to pay $210 million to resolve a pair of regulatory cases, the latest legal setback for the financial industry.
The Consumer Financial Protection Bureau, Wall Street’s newest regulator, accused Capital One of “deceptive marketing tactics.” The credit card company — which is known for its catchy television ads, asking “what’s in your wallet” — received a regulatory rebuke for misleading card customers into buying unnecessary products like payment protection and credit monitoring, according to the consumer agency.
As part of the deal with the consumer bureau, Capital One must reimburse about $140 million to customers. In a separate legal action, the Office of the Comptroller of the Currency, which regulates national banks, also sanctioned Capital One for bogus billing practices that spanned nearly a decade.
“We are putting companies on notice that these deceptive practices are against the law and will not be tolerated,” said Richard Cordray, the director of the consumer bureau. Before Mr. Cordray became director of the bureau, he ran its enforcement division.”
There’s a new sheriff in town — and Republicans would rather there wasn’t.