Companies pay to settle false marketing suits

Posted: Wednesday, December 13, 2006

HARRISBURG, Pa. - Two companies will pay a combined $14.5 million to settle claims that they tricked people in Alaska, Pennsylvania and 14 other states into paying for membership programs that claimed to offer discounts on automotive service, home repair and other services.

Sound off on the important issues at

Chase Bank USA, its subsidiary Chase Home Finance and Trilegiant Corp. allegedly offered free trial memberships to various discount programs without telling consumers that they would be automatically charged fees if they did not cancel the memberships within a certain time period.

"Consumers believed these offers were coming from Chase, and many thought they were getting rebates or consumer rewards," Pennsylvania state Attorney General Tom Corbett said. "Instead, their credit cards or mortgages were automatically billed for memberships in clubs that consumers may never have known about."

Consumers would enroll in the programs by cashing checks worth $2 to $10 - which many thought were rebates or rewards - that were often included in membership offers mailed to them, Corbett said. Fees of $49 to $99 or more would be charged to their credit cards or mortgage loans if they did not cancel during a "free" trial period, he said.

Under separate agreements, Norwalk, Conn.-based Trilegiant must pay more than $8 million in restitution to consumers, while Trilegiant and Chase Bank must pay more than $6 million to the settling states for civil penalties, legal costs and fees, Corbett said.



CONTACT US

  • Switchboard: 907-586-3740
  • Circulation and Delivery: 907-586-3740
  • Newsroom Fax: 907-586-3028
  • Business Fax: 907-586-9097
  • Accounts Receivable: 907-523-2230
  • View the Staff Directory
  • or Send feedback

ADVERTISING

SUBSCRIBER SERVICES

SOCIAL NETWORKING