By LawInspectsCredit One Settlement Lawsuit involves allegations of unfair practices like deceptive marketing and unauthorized fees against Credit One Bank. Credit One Bank is a financial institution based in Las Vegas, Nevada that provides credit cards to customers with low credit scores, and is the largest issuer of credit cards in the United States.
The federal class action lawsuit sought multimillion dollars in compensation from the bank to settle the allegations. Over the years there have been several complaints against Credit One, including unauthorized charges, excessive fees, deceptive marketing and lack of transparency, and the lawsuit essentially contained the same allegations against Credit One. Class Action Lawsuit allows a group of affected individuals to come together and seek damages against corporations and enterprises.
Allegations against Credit One
Class action lawsuit against Credit One filed in the year 2024 accused the institution of acting in violation of multiple consumer protection laws. These include Fair Debt Collection Practices Act, Fair Credit Reporting Act and Truth In Lending Act.
According to the class action lawsuit, Credit One imposed unauthorized charges on its customers that were never consented to by the latter. Such charges included credit monitoring services and identity protection services. Furthermore, Credit One was alleged to have imposed excessively high fees like late payment fees, annual fees and over-limit fees which were way higher than the cap mandated by federal laws.
The class action lawsuit also alleged that Credit One indulged in deceptive marketing. To be specific, the company misled its customers regarding terms of its credit cards, annual fees, penalties and interest rates. Customer complaints of deceptive or unfair methods of debt collection that violated the provisions of FDCPA were also included into the lawsuit.
Features of the Settlement Agreement
Class action lawsuit against Credit One reached a settlement agreement in the year 2024. As a part of the settlement agreement, Credit One agreed to pay compensations to the customers who were affected by its practices. The compensation covers damages suffered by the customers due to deceptive marketing practices, unauthorized fees and hidden charges. Furthermore, Credit One also acquiesced to cover the legal expenses and court costs incurred by the plaintiffs of the class action lawsuit.
The settlement agreement provides partial or complete debt relief to those customers who had unpaid balances pending with Credit One and were a part of the class action lawsuit. This is especially beneficial for customers who incurred financial losses due to unauthorized fees or deceptive practices.
Finally, the settlement agreement requires Credit One to make changes to its operations, such as making the information about various aspects of its services like credit care fees, interest rates and penalties transparent and straightforward for the benefit of the clients. Credit One also agreed to revamp its marketing strategies in order to convey the right information about its credit cards to the customers, as a part of the agreement.
It is pertinent to note here that Credit One did not accept any of the allegations, and agreed for a settlement to avoid a trial.
Eligibility for Compensation and Payout Amounts
Individuals who were customers of Credit One in the 2018-2024 period and fulfill certain requirements are eligible for compensation under the settlement agreement. The eligibility requirements to claim compensation are fees charged without disclosure, unauthorized transactions in the Credit One account, credit score problems due to errors made by Credit One and damage due to leak of personal information.
Payout up to $1000 would be made to any account holder who incurred financial losses due to unauthorized transactions. A base payout of $50-$250 would be paid to compensate for hidden fees. Additional compensation of $500 or more would be made to account holders who got negative credit ratings.
Timeline of the Compensation
Claim submissions would commence from April 2025 and the deadline for the same would be in the month of June 2025. Processing and approval of the claims would be completed in August 2025. First batch of compensations are expected to be paid by October 2025.