Consumer complaint received 2025-06-18 00:00:00
Product: Credit card — General-purpose credit card or charge card
Issue: Other features, terms, or problems — Other problem
Company: DISCOVER BANK
State: GA

Complaint narrative:
Subject : Formal Complaint Discover Banks Unauthorized Securitization, Deceptive Practices, and Credit Reporting Violations To Whom It May Concern, I am filing this complaint against Discover Bank and its affiliated entities, including Discover Financial Services, Discover Card XXXX XXXX I, and Discover Card Execution Note Trust, for engaging in unfair, deceptive, and abusive acts and practices ( UDAAP ) in violation of federal consumer financial protection laws. 

According to publicly available SEC filings ( XXXX XXXX, XXXX XXXX. XXXX ), Discover Bank securitizes consumer credit card receivablessuch as mineby transferring them into investment trusts. These receivables are used to issue XXXX XXXX XXXX XXXX ), which are then sold to investors on secondary markets such as the XXXX XXXX XXXX XXXX 

The Problem : At no point during my credit card application, approval, or servicing was I ever told that : My account would be used as collateral for securities ; My receivable would be assigned to a trust ; Or that these securities would be sold on the open market to investors. 

Despite Discover transferring the receivables into a trust for securitization, the company continues to : Collect payments on the account ; Report the account negatively to credit bureaus ; Treat itself as the creditor even after the beneficial interest has been sold. 

This is deceptive and harmful, and it violates numerous federal consumer protection laws. 

Violations of Federal Law : 1. Consumer Financial Protection Act ( CFPA ), 12 U.S.C. 55315536 Discovers failure to disclose securitization and its misrepresentation of its ownership status constitute Unfair, Deceptive, or Abusive Acts or Practices ( UDAAP ).

2. Truth in Lending Act ( TILA ), 15 U.S.C. 1601 et seq.

1637 ( a ) ( 6 ), 1639 ( b ) : Discover did not disclose the true nature of the transaction or the identity of the real creditor/investor. 

I was unaware that my account would be pooled and securitized into investment-grade securities. 
3. Fair Credit Reporting Act ( FCRA ), 15 U.S.C. 1681s-2 ( b ), 1681e ( b ) Discover continues to report my account as delinquent, even though it may no longer have legal standing or beneficial interest in the receivable.

4. Gramm-Leach-Bliley Act ( GLBA ), 15 U.S.C. 68016809 12 C.F.R. 1016 ( Reg P ) : Discover shared my nonpublic financial data with third-party trusts and investors without adequate notice, consent, or opt-out rights.

5. Uniform Commercial Code ( UCC ) 3-301 : Only a holder in due course may enforce a financial instrument. Discovers standing is unclear.

9-210 & 9-404 : I have not been given proper accounting or disclosure of the assignment of my obligation to another entity. 

Evidence : In its own SEC filing, Discover Bank states : The XXXX XXXX assets primarily include receivables arising under credit card accounts owned by Discover Bank... 

The Discover Card Execution Note Trust will apply to list these Class A ( 2011-2 ) notes on the XXXX XXXX XXXX XXXX 

Receivables represent amounts owed by cardholders under their credit agreements. 

This is material evidence that my account was securitized without my knowledge or permission. 

Impact on Me : I have suffered credit damage from inaccurate and misleading credit reporting. 

I have been misled about who owns my account and who has a legal right to enforce collection. 

My financial obligation has been monetized and traded without my consentyet I bear the full burden, including derogatory marks. 

What Im Requesting : Immediate investigation into Discover Banks securitization and disclosure practices ; A copy of all trust agreements, pooling schedules, and assignments related to my account ; Cease and desist all credit reporting and collection activity on any securitized or sold receivables ; Full discharge of the account balance, as Discover has already been compensated via securitization ; Financial compensation for credit harm, emotional distress, and privacy violations ( requested minimum : {$25000.00} ) ; A public ruling or enforcement order requiring informed consumer consent prior to securitization of receivables in the future. 

I am attaching the SEC Prospectus Supplement as Exhibit A which shows Discovers use of consumer credit obligations as the underlying assets for ABS traded in global markets. 

This conduct is deceptive, unlawful, and contrary to the consumer protection mission of the CFPB. I ask that your office investigate thoroughly and act decisively to protect consumers from similar harm.

Company response to consumer: Closed with non-monetary relief