July 07, 2010
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News: Cardholders Sue HSBC
One of London's most prominent banks is being sued by a group of credit card customers who say the bank was discriminatory in some of its activities. HSBC Holdings Plc, Europe's largest lender in terms of market value is being sued by a group of U.S. customers who claim the bank violated the rights of credit card payment protection services of individuals with disabilities, retired persons and the unemployed. The suit relates to the option that cardholders have and pay for that suspends or cancels the required credit card minimum payment due if the individual should become disabled or unemployed. However, according to the court documents, the bank failed to safeguard these accounts because the reason if “varied, complicated and always changing.” That's an ambiguous statement.
While the program sounds good, the credit cardholders say the bank planted ambiguous and incomplete information on the conditions which warrants this protection. The suit alleges that the plan preys on those who have already become victims of unfortunate circumstances and further adds to their misfortune. According to the suit, the bank enrolls individuals in the plan which costs $1.35 per $100 of the credit card balance and then sends them the terms and conditions which are misleading and ambiguous. Allegedly, the bank failed to inform the cardholders that the plan excludes self-employed, part-time workers, retired people and those who are already unemployed or on disability.
The case was brought before a U.S. District Court of Camden, New Jersey court which stated that HSBC Bank USA Inc. and HSBC Card Services Inc. violated the New Jersey Consumer Fraud Act and engaged in breach of contract. A separate case was brought before a U.S. District Court of Philadelphia, Pennsylvania also stating that the bank violated the Pennsylvania Unfair Practices and Consumer Protection Law. Both complaints are class action cases initiated by credit cardholders who say the program is worthless and the bank continues to charge them for services even though they are not eligible for benefits.