April 30 - The FDIC has announced a settlement with Citizens Bank of Pennsylvania, Philadelphia, for deceptive practices in violation of Section 5 of the Federal Trade Commission Act. Under the settlement, CBPA has agreed to an Order for Restitution and Order to Pay Civil Money Penalty. The order requires CBPA to pay a civil money penalty of $5 million and provide restitution of approximately $1.4 million to more than 75,000 affected consumers.
The FDIC determined that CBPA engaged in deceptive practices in violation of Section 5 in the marketing and implementation of its overdraft payment program, checking rewards programs, and stop-payment process for preauthorized recurring electronic funds transfer. The order, in part, requires CBPA to correct the violations of law, ensure future compliance, and prepare and implement a comprehensive restitution plan for all consumers adversely affected by the violations. The restitution timeframe extends between January 2008 and November 2011. CBPA will send reimbursements without requiring any action by affected consumers.
This action is being taken in coordination with the separate action of the Office of the Comptroller of the Currency against RBS Citizens, N.A., an affiliate of CBPA, for similar violations of Section 5 of the FTC Act.
In agreeing to the issuance of the Order, CBPA does not admit or deny any liability.
Click here for more information.