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Capital One Sued Over Credit Card Ads


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Capital One Sued Over Credit Card Ads

Fri Dec 31, 2:10 PM ET

NEW YORK (Reuters) - Minnesota's attorney general has sued credit card issuer Capital One Financial Corp. (NYSE:COF - news), accusing the big U.S. credit card issuer of falsely advertising low rates and defrauding consumers.

Attorney General Mike Hatch said Capital One nearly quadruples the rate it charges some card customers who trigger a "penalty" rate by paying a bill a day late or defaulting in other ways, according to a complaint filed on Thursday in a Ramsey County District Court in Minnesota and posted on Hatch's Web site.

A Capital One spokeswoman said the company "believes it has acted properly and in full compliance with the law," and is cooperating with the attorney general to resolve the matter.

According to the complaint, cardholders who receive an initial 4.99 percent interest rate and later default may see their rate skyrocket to 19.8 percent, even though Capital One advertised that the lower rate was "fixed."

The lawsuit said Capital One's marketing violates state laws against false advertising, consumer fraud and deceptive trade practices. Minnesota is seeking restitution for cardholders, civil penalties, disgorgement of profits, and an injunction barring further wrongdoing.

Capital One is based in McLean, Virginia.

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Mike Hatch is a serious AG. He responds to complaints of violations by collection agencies in his state. I fought with one that I sent EVERYONE copies of the complaint. The President of the CA was so mad, that he called my cell phone to tell me everything was deleted, and that he didn't appreciate me going through the AG first.

I kindly told him I have 5 letters to his company, all CMRRR IGNORED, and that the only way to make it move was to go up the chain. He said I should have called him. RIGHT!!! Well, needless to say he's still dealing with the wrath of the COMPLAINTS...

if you have problems with any collector or collection agency in MN, write a nicely worded complaint to Mike Hatch, Attorney General, and CC the Agency.

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Yep, he's an "no nonsense, take no prisoners" kind of guy.

His office staff is great and fast as well! When I filed an online complaint with them against IC Systems, they took care of it in about 10 days start to finish! BAM! It was gone!

Matt

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