First National Bank of Omaha has been ordered by the US Consumer Financial Protection Bureau (CFPB) to pay more than $35m in compensation and fines to nearly 257,000 consumers for deceptive marketing practices and illegal billing with credit card add-on products.
The enforcement action is the result of the CFPB’s investigation into First National Bank of Omaha credit card add-on products conducted in collaboration with the Office of the Comptroller of the Currency (OCC).
Accusing the bank for using deceptive marketing to lure consumers into debt cancellation add-on products and charging consumers for credit monitoring services illegally, CFPB ordered the bank to provide $27.75m in relief and pay a $4.5m penalty.
Separately, OCC has ordered the bank to pay a $3m monetary penalty for the unfair billing practices and compensate certain customers.
CFPB director Richard Cordray said: “First National Bank of Omaha violated the trust of its customers by illegally signing them up for credit card add-on products.
“The CFPB's track record, and this result today, shows strong and consistent action against credit card companies that dupe consumers into buying a product they do not want."
The latest order covers the bank’s unfair billing practices from 1997 to 2012, and the bank’s deceptive enrolment practices from 2010 to 2012, when the bank stopped its unlawful practices after a CFPB supervisory probe.