Aspire Compu-Credit, Marketer of Aspire Cards Hit With $11 Million Settlement and $525,000 in Civil Fines By New York Attorney General Eliot Spitzer Columbus Georgia

About time somebody did something about these creeps, who ripped me off for $150.00, just for opening this card. They have had their day in court! Here are some excerpts from the news article published in today's Atlanta Journal-Constitution:

Atlanta-based CompuCredit Corp., a marketer of charge cards to consumers with splotchy credit, has agreed to an $11 million settlement with the New York State attorney general's office following an investigation of the company's marketing and billing policies.

The settlement also calls for CompuCredit to pay an additional $525,000 in civil fines.

The investigation was sparked by numerous consumer complaints last year regarding Columbus Bank & Trust Co., which issues the cards.

The chief complaint was that CB&T, which is a subsidiary of Columbus-based Synovus Financial Corp., and CompuCredit failed to completely disclose the activation fees associated with the Aspire card up to $179 in some cases.

There were also complaints that the companies used improper tactics to collect debts and continually enrolled cardholders in third-party membership programs without consent and later charged renewal fees.

"This agreement sets a new standard in the way subprime credit cards are marketed and collected," New York Attorney General Eliot Spitzer said in a statement Friday when the settlement was announced. The action "reflects the state's ongoing commitment to protect those most vulnerable to fraud and deception."

Stephen A. Melton, president and chief executive officer of CB&T, said the bank, which has issued 2.5 million cards for CompuCredit, didn't intentionally seek to hurt customers.

"Anytime we have issues or concerns from a regulatory or enforcement agency, we work very hard to get them resolved," Melton said. "We've built our bank around taking care of our customers, not taking advantage of them."

CB&T has 231,000 cards that it owns and issues in its portfolio. It doesn't own the CompuCredit cards but, through a marketing arrangement, collects fees for issuing them. CB&T has been issuing cards for CompuCredit since 1997.

Because of the complaints, Melton said CB&T is initiating some changes, including the installation of new telephone equipment to make it easier for Aspire card customers to get to customer service. CB&T also is sending out questionnaires to cardholders and will use their answers to maker further customer service changes, he said.

As for the unauthorized enrollment of cardholders into third-party membership programs, Melton said CompuCredit stopped that last year. CompuCredit also has agreed to stop charging activation fees until after the cardholder uses the card.

CB&T will continue to issue cards for CompuCredit despite the problems, Melton said.

"I think all of the issues that he had have been taken care of," Melton said, referring to Spitzer. "They [CompuCredit] have been our partner, and we'll continue to work with them going forward."

http://www.ajc.com/business/content/business/stories/0704bizcredit.html

Pam
Senoia, Georgia
Georgia