Consumer complaint received 2018-02-05
Product: Credit card or prepaid card — Store credit card
Issue: Problem with a purchase shown on your statement — Credit card company isn't resolving a dispute about a purchase on your statement
Company: Bread Financial Holdings, Inc. (NY)

Dear CFPB : I am writing to your office to request assistance in what I believe to be predatory credit practices by a company called XXXX. 

By way of background, my mother, XXXX XXXX opened an account with XXXX believing that she was going to get a bill in the mail for a pair of pants that she ordered. The pants arrived, were of extremely poor quality and were returned back to XXXX. My mother was led to believe with this order she was under no obligation to keep the pants and in fact, paid a shipping and handling charge to ensure she owned no money. She made 1 single purchase, returned the items and purchased and/or received nothing else. 

What was not understood at all was that XXXX opened a revolving credit card in her name. XXXX began charging fees to this account that were not authorized or understood and the statements my mother has been receiving provide no clarity to these unauthorized charges. 

An attempt was made to dispute the charges and while the specific bogus membership fees were reversed, the account had incurred other charges such as late fees or other fees, which should have also been reversed when the company acknowledged their predatory and unfair practices of charging unknowing customers bogus fees. 

I would like your office to investigate if the target market for this type of predatory behavior is senior citizens. My mother is on a fixed income and would have had zero desire to open a credit card that she didnt need. Moreover, to enroll customers into some type of a loyalty program without their comprehension with a recurring credit card charge should require written consent. I am requesting that the actual fair credit lending practices be reviewed. 

Moreover, I attempted to contact the company XXXX. Apparently they have outsourced their credit billing to. They were unable to give me any details as to what the specific charges were. Various subscription charges, late fees and interest charges were explained, however, you need a valid purchase to actually incur fees on a credit card. There has to be some type of consumer protection that prevents this type of behavior from companies that portray themselves are retailers but are peddling credit issuance with unauthorized fees. 

XXXX XXXX XXXX, located in XXXX Ohio claims to be the servicer of the invoices but was unable to provide any clarity into what the charges were. XXXX referred me back to XXXX who doesnt answer their phones, putting customers into a never ending loop of no solution, frustration, and as time passes, more unfair late fees. 

It is my understanding that credit issuers have very distinct obligations. In the case of my mother, she has called repeatedly, with no outcome that has assisted her. It is principally unclear if XXXX is just a disreputable retailer or is in fact issuing credit. As a credit issuer, they have specific obligations including the ability for a client to dispute a charge or initiate a complaint. While she has attempted to dispute this matter, it is her understanding that either XXXX or XXXX have also reported this matter to the credit bureaus, causing damage to my mothers credit. 

At this point, I am requesting that both organizations be investigated. They have a finger pointing, customer unfriendly, and predatory practices that take advantage of customers who are not well versed in their rights as consumers. I would imagine my mother is one of many customers who have unwittingly fallen into this type of trap and before we review other options, would like to understand what your organization can do to assist us in a resolution. 

What is the ask from XXXX? 

As far as resolution, very simple : Reverse the bogus charges and associated fees placed on this credit card. 
Close the credit card customer request. 
Remove delinquent trade lines if reported to all credit bureaus. 
Confirm the above in writing. 

This complaint should not be simply resolved for one customer, a review of the predatory practices is in order. My mother as the XXXX XXXX of my XXXX year old father has been placed under a great deal of stress and despite her attempts to fix this situation, could not. This is simply not right. 

I would be more than happy to discuss this matter in detail or if legal recourse is more appropriate, would more than welcome that advice from your agency/organization. 

Respectfully yours, XXXX XXXX Phone # XXXX XXXX XXXX XXXX XXXX XXXX XXXX, NY XXXX