HSBC Card Services “slams” its credit-card holders by enrolling them in “virtually worthless” payment protection plans without notice, says a federal class action lawsuit. What’s worse, the suit continues, is that HSBC solicits retirees, the disabled and other people they know don’t qualify for the plan’s benefits, allowing the credit card company to reap millions of dollars in profits.
According to the HSBC Card Services class action lawsuit, HSBC enrolls consumers into the payment protection plan without their knowledge, does not disclose the terms of the plan until after a customer is enrolled, and pitches it to people they know do not qualify for benefits.
“HSBC does not make any effort to determine whether a subscriber is eligible for Payment Protection benefits at the time of sale. As a consequence, HSBC bills thousands of retired persons (many of whom are senior citizens), along with the unemployed, self-employed, part-time or seasonal Illinois residents, as well as disabled individuals, for Payment Protection coverage, even though their employment or health status prevents them from receiving benefits under the plan,” the HSBC class action lawsuit states.
“HSBC knows that for those subscribers who choose to pay for Payment Protection, few will ever receive benefits under the plan and even for those that do, the amounts paid in ‘premiums’ will usually exceed any benefits paid out,” the class action continues, adding that HSBC’s Payment Protection plan is a “dense maze of limitations, exclusions and restrictions, making it impossible for customers to determine what Payment Protection covers and whether it is a sound financial choice.”
Customers that try to cancel HSBC’s payment protection are led through a customer service system designed to make canceling the plan difficult, if not impossible.
A similar class action lawsuit against Discover Card’s Payment Protection plan is currently pending, and Capital One recently reached a class action settlement concerning its deceptive marketing tactics for its payment protection plan several months ago.
A copy of the HSBC Payment Protection Plan Class Action Lawsuit can be read here.
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