(Finance) – The Consumer Financial Protection Bureau (CFPB) of the United States has sued Comerica Bank for having systematically disappointed its 3.4 million Direct Express cardholdersmostly unbanked Americans receiving federal benefits. The bank knowingly disconnected 24 million customer service calls, preventing cardholders from exercising their rights under the law, charged illegal ATM fees to more than 1 million cardholders, and improperly handled fraud complaints, while provided federal subsidies through the Direct Express prepaid debit card program.
The CFPB is asking the court to order Comerica to stop these practices, provide refunds to affected customers, and pay civil penalties which would go to the CFPB’s victim relief fund, it said in a statement.
“The CFPB is suing Comerica Bank for having Illegally harmed disabled and elderly Americans who rely on Social Security and other federal benefits,” said CFPB Director Rohit Chopra. “By deliberately disconnecting millions of calls and collecting illegal junk fees, Comerica has increased its profits at the expense of Americans living on fixed incomes.”
Comerica Bank is a subsidiary of Comerica Inc.a NYSE-listed financial services company that is among the 25 largest bank holding companies of the United States. As of the end of 2022, Comerica reported total assets of more than $84 billion and total deposits of more than $71 billion.
Since 2008, the Treasury Department has stipulated a contract with Comerica Bank to administer the Direct Express program, which allows federal beneficiaries to receive their monthly benefit payments via prepaid debit cards. Direct Express currently serves approximately 3.4 million Americans.