The Consumer Financial Protection Bureau is suing Texas-based company Union Workers Credit Services for allegedly tricking consumers into paying fees to sign up for a bogus credit card.
It is alleged that Union Workers Credit Services engaged in false advertisement by advertising what appears to be a general-use credit card. However, in reality the card can only be used to purchase products from the company. In addition the company is alleged to have implied an affiliation with unions by using pictures of nurses, firefighters, and other public servants in its advertising. The CFPB is asking for victims to be compensated and that a civil penalty and injunction be made against the company.
“The business model for Union Workers Credit Services is built on duping consumers into signing up for a sham credit card,â€ said CFPB Director Richard Cordray in a statement. “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. From the misleading photos of nurses and firemen on its website to its bogus credit card, Union Workers Credit Services is illegally deceiving consumers.â€
Read the full CFPB report here.