Sham credit-card company tricked union employees into paying fees

Texas-based Union Workers Credit Services isn’t affiliated with any workers’ unions, and the credit cards it issues can be used only in its own stores—but its advertising is misleading on both those points, the Consumer Financial Protection Bureau (CFPB) says in a lawsuit against the company, according to a CFPB press release. The Bureau “alleges that the company falsely advertises a general-use credit card” and “deceptively implies an affiliation with unions by, among other things, using pictures of nurses, firefighters, and other public servants in its advertising.” CFPB Director Richard Cordray said of the lawsuit, “Hundreds of thousands of people, including a great many union members who were specially targeted, have been tricked into spending millions of dollars for a so-called credit card that can really only be used to buy the company’s own products.” Consumers pay $37 to apply by mail or $95 to apply online for the cards; most never use them but “cannot recoup their membership fees.” The Bureau’s lawsuit “seeks to stop the alleged unlawful practices of Union Workers Credit Services” and requests penalties against the company as well as compensation for consumers who have been harmed. For more, read the full release.

Consumer Financial Protection Bureau, Consumer Lending and Services, Legal Developments