Cabela’s Bank Fined $1 Million for Deceptive Credit Card Practices
The credit card bank operated by outdoor retailer Cabela’s is now facing a $1 million fine from the Federal Deposit Insurance Corp for allegations of deceptive and unfair acts.
In March 2011, the bank had to pay $10.4 million in restitution and fines for improper fees on their credit cards.
The FDIC has stated that the bank, World’s Foremost Bank, has agreed to sanctions but did not admit to or deny the violations.
“We at World’s Foremost Bank recognize we are operating in a dynamic and evolving regulatory environment and it is our responsibility to meet these expectations,” the bank’s CEO, Sean Baker, said in a statement. “As such, we immediately addressed the FDIC’s concerns and remain committed to providing legendary customer service to our cardholders, as we have throughout our history.”
The $1 million fine covers several refunds, including those for certain interest charges and credit card add-on services deceptively offered to credit card customers. The restitution set up by the FDIC will include:
- Refunding any interest paid within a interest-free 12 month period
- Refunding premiums for LifeLock for 905 customers in Fort Worth, Texas who purchased the add-on between October and December 2012. In connection with this, the bank must let customers know that they are not required to carry LifeLock to have a Cabela’s Club Visa card.
- Provide points that can be redeemed for merchandise to customers whose credit card bills were paid by an emergency payment plan.