FDIC Announces $114 Million Settlement With Subprime Credit Card Company Charged With Deceptive Credit Card Marketing

(FDIC) The Federal Deposit Insurance Corporation (FDIC) announced today a settlement with CompuCredit Corporation, Atlanta, Georgia (CompuCredit), a company charged with deceptive marketing of subprime credit cards with three FDIC-supervised banks in violation of the Federal Trade Commission Act (FTC Act). Two of the banks previously settled with the FDIC.

The settlement will result in an order that will correct the FTC Act violations, and provide restitution of approximately $114 million to consumers in the form of credits for certain fees arising from the deceptive marketing practices. Eligible consumers whose current balances are less than the amount of credits to be applied will receive cash refunds, the aggregate amount of which is estimated to be approximately $3.7 million. All other eligible consumers will receive credits only. No action by consumers is required; eligible consumers will be contacted directly by CompuCredit. The credits and cash refunds will be verified by an independent accounting firm acceptable to the FDIC. The order also includes a civil money penalty (CMP) of $2.4 million. More...