Discover to Pay $200M to Settle Probe into Credit Card Protection Products

Discover Financial Services (DFS) has agreed to refund hundreds of millions of dollars to settle a regulatory probe of its credit card marketing practices.

The issuer’s Discover Bank subsidiary will return $200 million to cardholders who purchased credit card protection products from the company via telephone unknowingly over a roughly three-and-a-half-year period beginning in December 2007, as part of an agreement with the Federal Deposit Insurance Corp. and the Consumer Financial Protection Bureau, the company said late Friday,

Discover also agreed to pay a combined $14 million in penalties to the agencies and to improve its sales practices.

“We have worked hard to earn the loyalty of our cardmembers, and we are committed to marketing our products responsibly,” Discover CEO David Nelms said in a news release.

Read on.

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