A Comerica Financial institution signal on a constructing in Walnut Creek, California, March 30, 2023.
Smith Assortment/gado | Archive Pictures | Getty Photos
The Shopper Monetary Safety Bureau filed a criticism Friday in opposition to Comerica Financial institution, accusing the regional financial institution of failing to manage a federal advantages program that makes use of pay as you go debit playing cards.
The lawsuit claims Comerica Financial institution “deliberately terminated” greater than 24 million customer support calls, charged greater than 1 million cardholders ATM charges they did not owe and mishandled fraud complaints whereas offering federal advantages by the Direct Categorical pay as you go debit card program.
“By intentionally disconnecting thousands and thousands of calls and harvesting unlawful junk charges, Comerica boosted its backside line on the expense of Individuals residing on a hard and fast earnings,” CFPB Director Rohit Chopra mentioned.
The Direct Categorical program is a pay as you go card that beneficiaries of Social Safety and different federal applications can use to pay for bills together with groceries and fuel. Comerica has been contracted with the Division of the Treasury since 2008 to manage this system and deal with customer support for the thousands and thousands of Individuals utilizing the pay as you go card, a lot of whom are disabled and older and haven’t got a financial institution.
Whereas the Direct Categorical web site advertises 24/7 customer support, the CFPB alleges that “when folks had issues with their accounts, it was usually unattainable to speak to somebody who would assist.”
Comerica filed an earlier criticism in opposition to the CFPB on Nov. 8, arguing the bureau had overreached in its dealing with of the case and “has did not acknowledge that, as Monetary Agent of the Direct Categorical program, Comerica typically acted with the oversight and data or approval of the federal authorities,” the swimsuit reads.
“All through the CFPB’s investigation, we have now cooperated by sharing data and knowledge as an example the distinctive nature of this program and the truth that we function with the oversight of the Fiscal Service,” mentioned Louis Mora, Comerica vp of media relations. “Regardless of our good religion efforts to supply this vital context, the CFPB has persistently ignored our arguments and documentation.”
“We’ll proceed to vigorously defend our file because the monetary agent for the Direct Categorical program and stay dedicated to serving our cardholders,” Mora continued.
The CFPB has taken motion in opposition to banks for mishandling advantages up to now, together with in 2022 when the bureau fined Financial institution of America $100 million for mishandling state unemployment advantages in 2020 and 2021. The Workplace of the Comptroller of the Foreign money additionally fined the financial institution $125 million in a separate order.
— NBC Information’ Steve Kopack contributed to this report
