Firms Paying Back Millions on Military Auto Loans
Military.com
by Richard Sisk
Jun 28, 2013
U.S. Bank and its marketing partner have agreed to pay back $6.5 million to more than 50,000 servicemembers who were hit with hidden fees on auto loans, a government consumer watchdog agency said Thursday.
The Minnesota-based U.S. Bank and its partner, Dealers Financial Services of Lexington, Ky., avoided a potentially bigger payout from a civil lawsuit by agreeing to cooperate with the investigation by the Consumer Financial Protection Bureau and the Defense Department.
Under the arrangement, U.S. Bank will pay $3.2 million and DFS will pay $3.3 million to more than 50,000 servicemembers who had outstanding loans from January 2010 until now, the consumer protection bureau said.
The average payment to each servicemember will be about $100, a spokesman for the CFPB said, and servicemembers will not be required to take any action to receive their reimbursement. U.S. Bank and DFS will provide the reimbursements as an account credit or as a check in the mail, the bureau said.
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