CFPB Orders $34.1 Million Healthcare Card Refund
The Consumer Financial Protection Bureau is ordering a $34.1 million refund to over one million customers who have used GE Capital Retail Bank’s CareCredit card.
CareCredit cards are designed to pay doctor and dentist bills with no interest, but recent reports have indicated many consumers paid significant amounts of interest if their balances were not paid during the promotional period.
“The Consumer Bureau came to this case after receiving substantial complaints from consumers. According to the order we are filing, CareCredit has been engaged in harmful consumer practices since January 2009,” said Richard Cordray, Director of the CFPB.
Many of the complaints suggest that the card’s terms were vague, or they were administered to customers by people who had little to no training through CareCredit.
As previously reported, CareCredit first started feeling the pressure of the complaints earlier in the year. With the CFPB’s involvement, the company’s somewhat shady practices are sure to be stopped.
“CareCredit will have to be more transparent to consumers about its product in the future,” Cordray continued. “It must make consumers aware of the high interest rates that will be applied if the charge is not paid off at the end of the promotional period.”
For transactions over $1,000, customers will have to enroll in the program directly through a CareCredit representative, not a doctor or dentist office.