State AG Says Discover Makes Millions Through Deceptions

[UpInArms]

Source: Courthouse News

MINNEAPOLIS (CN) - Discover Financial Services makes millions from "highly deceptive and misleading telemarketing" that enrolls people in expensive "protection" plans from which they never will benefit because they do not know they signed up, Attorney General Lori Swanson claims in Hennepin County Court. "Discover is in a position to do this because, unlike a typical telemarketer, it is the consumer's credit card company and already has their credit card number," the attorney general says.

Swanson says the credit card giant "earns nearly $300 million in annual revenue from the sale of several optional fee-based financial products, an increase of over $80 million, or more than 37 percent, from just two year ago."

Discover pushes its four plans "as ways for consumers to protect themselves from fraudulent or unauthorized charges or to enhance their financial security against such hazards or hardships like job loss or sickness, identity theft, lost wallets, or low credit scores," Swanson says in the 25-page complaint. "Yet Discover often enrolls consumers in these products based on highly deceptive and misleading telemarketing calls, charging some consumers without their meaningful consent or understanding that their credit cards will be charged for these products. Discover is in a position to do this because, unlike a typical telemarketer, it is the consumer's credit card company and already has their credit card number."

<snip>

"If the telemarketer can elicit some affirmative response from the cardholder, such as 'OK or 'yes' after the 'disclosure,' the telemarketer treats the affirmative response as the cardholder's agreement to enroll in the plan," the state says.

Often telemarketers read the disclosure quickly, make odd pauses, "butcher" the text or skip over important terms - "such as the word enrollment" - in order to confuse the cardholder, Swanson says.

Read more: http://www.courthousenews.com/2010/12/08/32414.htm

[cutlassmama]

1. Yes, this is true. I was a victim of this some years ago. They are sneaky

bastards!

[RKP5637]

2. Penalties are never enough for companies like this. They get

a $ slap on the wrist and move on ...

[Sherman A1]

3. SImple response, when they go off on their sale pitch...

"Just send me the information and I will look it over, but I am not ready to make any changes today".

[ddeclue]

4. i have repeatedly told them too jump up my ass when they ask me to sign up.

If I am unemployed they don't get paid. That's my rule for people who charge me 27% interest. I've been paying that card down this year because I finally have a good steady job and when it is paid oFf I will close it cut it up and have a little bonfire.

[RKP5637]

5. Good idea. These credit card companies are now nothing more than scams, ripoff

artists and among the worst of corporations. They are sleaze. In a country with real usury laws they would be put out of business. Here, they pay their way for protection.

[HopeHoops]

6. Discover and Capital One - two companies to NEVER get fooled into dealing with.

If you own either, clear the balance and get rid of the damn thing.

[mdmc]

7. ..