Consumer complaint received 2025-07-22 00:00:00
Product: Credit card — General-purpose credit card or charge card
Issue: Problem when making payments — Problem during payment process
Company: DISCOVER BANK
State: NC

Complaint narrative:
b'Formal Complaint for Commercial Dishonor, Return Without Cause, Mishandling of Negotiable Instrument, and Breach of Fiduciary Duty Following Endorsement, Discover Bank\n\nOn XXXX XXXX XXXX, a negotiable instrument in the form of a Gold Clause Check was lawfully issued by the XXXX XXXX XXXX XXXX XXXX in the amount of XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXs ([USD $XXXX]) for lawful remittance toward a revolving credit account associated with the XXXX legal estate. \n\nThe remittance was executed in full compliance with [31 USC 5118(d)(2)] and [12 USC 411], and mailed via Certified Mail (XXXX  Tracking No. [XXXX XXXX XXXX XXXX XXXX XXXX]) to Discover Banks legal remittance division (see attachment). The mailing included a remittance letter referencing all applicable legal authorities, a payment coupon, and a lawful demand for either acceptance or written objection within 10 business days of receipt (see attachment).\n\nOn XXXX XXXX XXXX, Discover Bank physically handled the check and officially marked it with its internal processing stamp: RECEIVED AT XXXX XXXX XXXX XXXX  (see attachment). This stamp constitutes a formal banking endorsement under [UCC 3-204(a)], which defines an endorsement as any signature or mark made for the purpose of negotiating, accepting, or acknowledging presentment. The reverse of the instrument also bore a clear prior endorsement by the XXXX XXXX XXXX XXXX XXXX, executed by the undersigned Trustee prior to mailing. This endorsement confirmed lawful issuance, fiduciary capacity, and the XXXX  legal authority to tender the instrument in good faith under [UCC 3-401], [UCC 3-501(b)], and [UCC 3-204(c)] (see attachment). \n\nFrom the moment of endorsement, Discover acquired legal responsibility to either process the instrument in satisfaction or return it with lawful, timely, and substantiated cause under [UCC 3-502] and [UCC 3-505]. The act of presentment, combined with Discovers failure to timely apply or lawfully reject the instrument, constitutes full discharge of obligation under [UCC 3-603(b)] and [31 USC 5118(d)(2)]. The XXXX  tender was made in full reliance on federal law protecting gold clause contracts and lawful money instruments. Discovers failure to honor such tender, following endorsement, extinguished its claim in law. \n\n\nThat discharge became complete and binding once Discover failed to cure or respond within the commercial time limit.\n\nDiscover did neither. Instead, it retained the instrument in its possession for more than 14 days. There was no written response, no formal rejection, no signed explanation, and no claim of commercial defect. When the instrument was finally returned, it was accompanied only by a generic insert stating, without cause or context, We are returning the enclosed item(s) to you. (see attachment) No responsible party signed the return, no statutory basis was cited, and no notice of dishonor was issued in accordance with lawful protocol. Discover and/or its agents had the Trustees contact information and could have made timely inquiry, rebuttal, or lawful objection. \nThis was a good faith offer of lawful tender, submitted with full commercial transparency. \n\nDiscover and/or its agents chose silence, evasion, and dishonor. This conduct violates standard commercial banking protocol, which demands action on presentment within 24 to 72 hours, and also exceeds the response window clearly established in the remittance letter. The failure to issue a lawful return or protest, as required under [UCC 3-505], combined with the absence of any lawful communication or rebuttal, constitutes commercial dishonor by silence and default under [UCC 3-502(a)(2)].\nOn or around XXXX XXXX XXXX, well beyond the cure window, Discover returned the check via regular First-Class Mail. This return method is itself a breach of duty. Negotiable instruments must be returned using secure, accountable channels to preserve chain of custody and protect both parties.\n\nDiscovers use of untracked mail for the return of a financial instrument violates [12 CFR 229.34] and [31 CFR 328.5], which govern the return and safekeeping of financial obligations. By failing to use Certified or Registered Mail, Discover not only failed to act in good faith, it also stripped the Trust of any lawful tracking mechanism or opportunity to assert standing upon re-tender.\n\nMore egregious, the instrument was returned with no accompanying legal justification. The only document enclosed was an unsigned, generic slip of paper stating, We are returning the enclosed item(s) to you. (see attachment) No statutory authority was cited. No contractual objection was made. No signature from any authorized officer of Discover was included. There was no statement of defect, forgery, fraud, material omission, or countermand. The return was functionally anonymous and substantively void.\n\nAdditionally, the remittance package originally sent by Certified Mail included multiple componentsnot merely the check, but the coupon, the remittance letter, and accompanying documents necessary for full lawful processing. Upon the return, however, not all of these materials were included. Only a subset of the original tender was sent back, as confirmed in the scanned attachments now included with this filing (see attachment). Discover retained or failed to return all instruments previously placed in its custody. This partial return of a certified financial packet constitutes a breach of procedural duty under [UCC 3-501(b)(3)], a violation of the remittance contract terms, and potential conversion of trust property under [Restatement (Third) of Trusts 85].\n\nThis constitutes return without cause, an act of procedural bad faith and commercial dishonor under [UCC 3-311]. When a party receives and retains a tendered instrument, yet fails to raise a lawful objection within a commercially reasonable time, the obligation is deemed discharged. \n\nUnder [UCC 3-603(b)], a debt is satisfied when a tender is made and unjustifiably refused. Discovers conduct meets and exceeds this threshold. The XXXX  performed in full under applicable law. Discover failed to rebut, refused to cure, and defaulted by its own silence and procedural evasion. \n\nThis is not a case of a misrouted payment, clerical error, or ordinary consumer grievance. Discover received a lawfully drawn instrument from a perfected trust, endorsed it, held it, then attempted to quietly erase its obligations by returning it without explanation, over two weeks later, through an insecure method, in direct violation of federal regulation and commercial duty. \n\nThis was not an accidental oversight, it was a calculated refusal to acknowledge a lawful remittance, performed under Title 31, Title 12, and the Uniform Commercial Code. \\The evidence shows a deliberate effort to retain the instrument, avoid acknowledgment, and manufacture plausible deniability through passive return.\n\n Not only dishonored a lawful remittance, it breached its fiduciary obligations under [Restatement (Third) of Trusts 78], violated applicable federal banking rules, and failed to honor legal tender protected under [31 USC 5118] and [12 USC 411]. The remittance letter specifically stated that failure to return the instrument with lawful cause within 10 business days would constitute discharge and default. That outcome has now occurred.\n\nThe lawful window for Discover to issue any valid protest, rebuttal, or commercial objection has long since passed. Under the controlling provisions of [UCC 3-603(b)], [UCC 3-505], and the Restatement of Contracts, the obligation stands discharged as a matter of law. Discover is now estopped by its own conduct from asserting any further claim, demand, or attempt to collect against the XXXX. \n\nAny such action would constitute commercial fraud, abuse of process, and knowing trespass against a perfected administrative record. \n\nThe record now reflects full discharge, and the XXXX XXXX XXXX XXXX XXXXt is to be made whole in all matters pertaining to this obligation. \n\nThe XXXX  reserves all rights for future remedy and enforcement.\n\n______________________________________________________________\nRespectfully submitted on behalf of:\nXXXX XXXX XXXX XXXX XXXX.\nBy: XXXX XXXX XXXX, Attorney in Fact\nXXXX XXXX XXXX XXXX XXXX XXXX\nXXXX XXXX XXXX XXXX\nEmail: XXXX\nAll rights reserved.'

Company response to consumer: Closed with explanation