Capital One Credit Card Woes

The credit card industry, within the last few years, has come under closer oversight and regulation. Dave Ramsey in his Financial Peace University class lessons of Dumping Debt and Credit Sharks in Suits has been particularly critical of the bad behavior and sometimes illegal practices of credit card companies.

Just last week Capital One Financial Corporation agree to pay $210 million to settle allegations that they allowed its call-center contractors to pressure customers to purchase add-on products that they didn’t understand, need, want or would qualify for. Credit One will begin refunding customers who purchased the products after August 2010. The have stopped selling them. Other banks are expected to face similar scrutiny.

This was one of the first actions by the newly formed Consumer Financial Protection Bureau (CFPB) of the Obama administration, headed by former Ohio Attorney General Richard Codray. The CFPB reports that Capital One is one of the biggest source of credit card company consumer complaints.

The credit card industry probably feels that they are over-regulated, but they have had much free rein for decades, abusing and taking advantage of consumers, to their [billion dollar] profit. I welcome the CFPB’s aggressive stance towards credit card companies, as well as the Credit Card Reform Act of 2009- they are both a great start to combating abuses of that industry that have gone on for far too long.