After the Consumer Financial Protection Bureau filed a complaint against PayPal today, the company quickly agreed to refund $15 million to customers it ripped off over the past few years.
PayPal will also pay an extra $10 million in fines to the CFPB, so the total settlement is $25 million. The CFPB accused PayPal of all sorts of schemes, so many that it kinda sounds like PayPal is run by my Grandpa Hirtz in his 1980s casino-boat drinking days rather than business professionals.
The almost impressively illegal scams that PayPal’s now paying for include:
Advertising deferred-interest promotions, but then flat-out giving customers the wrong information when they asked about them, or just never answering the customer service line
Charging customers with the interest they were unable to defer due to receiving the wrong information and/or never being able to speak to a representative about the deferred-interest promotion
Automatically signing people up for credit accounts without asking permission
Setting these credit accounts as the default for purchasing, which led to people getting hit with late fees and interest fees on accounts they didn’t know existed
Lying about $5 and $10 credit promotions and then never fulfilling them (total Grandpa move)
Not bothering to remove late fees even after people paid them
Taking weeks to process payments
Not bothering resolving customer disputes
It’s telling that the company ponied up the money within a day of the complaint.
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