New York’s state attorney general, Andrew Cuomo, is reported to have said that a probe of the bank’s activities unearthed evidence that it was charging some credit card customers upfront fees that used the majority of their credit limit, despite claiming that opening an account would be free of charge. According to the New York Times, this put consumers in debt, even before carrying out transactions with their card.
However, First Bank has staunchly denied claims that it used misleading marketing tactics, and the New York Times cited Miles Beacom, chief executive of the company, as saying: We have operated our business with the highest level of integrity. Mr Beacom went on to say that the practices that the bank is accused of implementing were abandoned several years ago.
However, according to Reuters, citing an announcement made by the attorney general’s office, as well as agreeing to pay the settlement, First Premier has said that it will alter is marketing and billing methods. The settlement sum will go to the state and be used to reimburse customers for any of the bank’s charges that are deemed unlawful by the attorney general’s lawyers.
The attorney general initiated the probe into First Premier’s marketing tactics in late 2004, after receiving approximately 100 consumer complaints, the New York Times reported.
