FDIC Announces $114 million Compucredit Settlement
Losses and Lawsuits
WASHINGTON, DC - The Federal Deposit Insurance Corporation (FDIC) has announced it will settle with credit card firm CompuCredit for $114 million. The US regulator had charged the company with deceptive marketing of subprime credit cards with three FDIC-supervised banks, in violation of the Federal Trade Commission Act (FTC Act).
South Dakota-based First Bank & Trust has yet to settle, while the two other banks involved - Columbus Bank & Trust and First Bank of Delaware - had previously settled with the regulator.
The FDIC says the settlement corrects the FTC Act violations and provides $114 million in restitution to affected consumers. CompuCredit must also pay a civil money penalty of $2.4 million and ensure future solicitations meet FDIC disclosure requirements. The company says the settlement relates to practices dating back to 2005 and earlier, requiring no changes to its current practices.
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