Consumer Bureau Action Tracker

CFPB – Santander Bank


State

Massachusetts

target

Santander Bank, N.A.

Topics

Enforcement, Deceptive Practices, Regulation E, Banking, Checking, Debit Cards, Overdrafts

The CFPB ordered Santander Bank to pay $10 million for “illegal overdraft fees,” alleging it had “deceptively” hired telemarketers to enroll customers in an “overdraft program,” and then “charge a $35 overdraft fee on each transaction.” Santander incentivized this illegal overdraft program by paying these telemarketers “higher hourly rates when they met quotas.” The CFPB claimed that the telemarketers had “improperly signed up customers for the service without their consent, as well as misled others that the service was free.” Santander blamed the telemarketing service for the error.

  • The complaint alleged that “employed telemarketers to sell its ‘account protector’ service, which authorized Santander to pay out ATM transactions and one-time debit card purchases, even if they overdraw the account, and then charge a $35 overdraft fee on each transaction. The bank rewarded these sales reps with higher hourly rates when they met sales quotas” and that telemarketers “improperly signed up customers for the service without their consent, as well as misled others that the service was free.” [Megan Leonhardt, “Santander Bank Fined $10 Million for Illegal Overdraft Fees”, Time Money, 07/14/16]

Status

Active


2016-CFPB-0012 7/14/2016 7/14/2016

Consumer Financial Protection Bureau Orders Santander Bank to Pay $10 Million Fine for Illegal Overdraft Practices
http://www.consumerfinance.gov/policy-compliance/enforcement/actions/santander-bank-n/

  • Consumer Financial Protection Bureau (CFPB)
  • Administrative filing
  • None
  • Bank
  • $10,000,000
  • Not Available

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