Category: 
And pay restitution.
The Federal Deposit Insurance Corporation announced on December 3rd, a list of enforcement actions going back some months. On June 10th they ordered First Bank of Delaware to Cease and Desist from certain deceptive marketing practices and to pay restitution. The Order they made available lays out all the detail.
Copies of the orders referred to above can be obtained from or inspected at the FDIC’s Public Information Center, 3501 Fairfax Drive, Room E-1002, Arlington, VA (telephone 703-562-2200 or 1-877-275-3342). To view all orders online, visit the FDIC’s Web page at http://www.fdic.gov/bank/individual/enforcement/index.html.
In essence they operated their National Consumer Products division without adequate supervision. One of the companies they worked with appears to have been offering credit products in a way that was deemed deceptive by the government. This is one of the most highly regulated industries in the nation and all aspects fall under State and or Federal government review. They were ordered to terminate the relationships the bank had with these specific subprime lenders.
Within sixty (60) days of the effective date of this ORDER, the Bank shall develop and submit to the Regional Director of the FDIC’s New York Regional Office (Regional Director), for her non-objection in accordance with paragraph XIII.A of this ORDER, a comprehensive plan, with timelines, for the termination of all relationships with third-party providers and the termination of all third-party lending programs or any agreements or arrangements with third-party providers that exhibit the characteristics of a “Rent-a-BIN” or “Rent-a-ICA” arrangement, as referred to in the FDIC’s Credit Card Activities Manual, except for those third-party lending programs and third-party providers specifically identified in Exhibit “B” of the Consent Agreement.
The FDIC action report makes it sound like the bank was quite sloppy in overseeing this unit.
And finally, they must set aside $700,000 to backstop CompuCredit Corporation, Atlanta, Georgia (CompuCredit) in case they cannot pay all their ordered restitutions.
Comments
This entry was posted on Sunday, December 21st, 2008 at 9:34 pm and is filed under Government, Industries, Law & Legal. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
First Bank of Delaware has closed the accounts of all of its Tribute MasterCard customers. In my case, I learned about it when I went to the website to pay my bill and learned I had a zero credit line after two years of a perfect payment record. It took a few phone calls (during which I was assured by various customer service reps that I am a “valued” customer) and some internet research to find out that all accounts had been closed. I’m very happy to know that First Bank of Delaware CEO Alonzo J. Primus thinks I’m such a valued customer. I’d hate to see how I would be treated if he didn’t value my business. First Bank of Delaware has zero regard for their customers and zero regard for any kind of responsible banking practices. Unfortunately for all of us, too many of our financial and banking leaders are criminals in good suits with big paychecks, but they are still criminals. Like someone once said, you can put lipstick on a pig, but it’s still a pig.
Dale,
Thanks for sharing your experiences with us. Keep us posted if anything new develops.
Russ
The same exact thing happened to me. However, I just paid my final balance, (which was less than $30) and figured, whatever, I’ll just do without a credit card. Then I logged onto the website to make sure my payment had been received(yes) and now they are still charging me for the $10/mo account maintenance fee! How much longer to people like me have to be punished for having bad credit? I have tried so very hard to get my credit back on track and have paid my bills responsibly since filing bankruptcy, and I just can’t seem to get a break!!!!! If anyone hears of any legal action being taken against these predators, please email me at the above mentioned address.
I received a letter account be closed but another letter stated new cards to be issued in November. I also emailed and an answer is that they are financially sound.
I had a Tribute card with them. Entered into a settlement and thought I was done with them. I just got contact by some company that says they bought all the Tribute accounts and are now collecting on them. Watch out and demand proof before you pay anything