Discover paid $35 million after violating prior CFPB order and committing additional student-loan servicing violations
Company: Discover Financial Services
Summary
In December 2020 the CFPB issued another consent order against Discover Bank and affiliates after finding that Discover violated its 2015 Bureau order and committed additional unlawful student-loan servicing practices. Discover misrepresented minimum payments, interest paid and other material servicing information, failed to provide all required redress, withdrew payments from more than 17,000 consumers without valid authorization, and cancelled or failed to withdraw payments for more than 14,000 consumers without notification. The CFPB also found deceptive representations affecting more than 100,000 consumers concerning minimum payments and more than 8,000 consumers concerning interest paid. Discover was required to pay at least $10 million in consumer redress and a $25 million civil penalty. Primary source: https://www.consumerfinance.gov/archive/newsroom/consumer-financial-protection-bureau-settles-with-student-loan-servicers-discover-bank-the-student-loan-corporation-and-discover-products-inc-for-violating-a-bureau-consent-order-and-other-unlawful-practices/