Minnesota AG sues Discover after Dent man charged $900 for protection services
Delbert Engler didn't even remember talking to representatives from Discover, his credit card company, until he heard his own voice in a recording presented to him by Minnesota Attorney General Lori Swanson.
Not only was the conversation a surprise, so was the $900 in charges the Dent, Minn., man later found on his bill.
Engler's case is one of what Swanson believes could be thousands nationwide. She filed a lawsuit on Monday in Hennepin County District Court against Discover Bank, DFS Services and parent company Discover Financial Services that states they broke state consumer fraud and deceptive trade practices laws.
"This is a case of a credit card company playing gotcha instead of playing fair," Swanson said.
Swanson's office began an investigation after it received several complaints from Discover customers. They would allegedly receive a "courtesy call" and then find they had been signed up for "protection plans" they did not order.
Swanson's office requested tapes of these calls, which is how they found the call made to Engler, among others.
Engler, 55, was charged about $900 for a payment protection plan that covers his monthly payments if he loses his job or becomes disabled.
Engler works nights and said the call came when he was trying to sleep.
Ben Wogsland, with Swanson's office, said there was nothing in the conversation to indicate Engler had agreed to purchase the program.
The attorney general said calls come in under the guise of a courtesy from Discover, but then the caller talks fast, skips over words and rushes customers through a script to sign them up for the programs, including payment protection, identity theft protection and credit monitoring.
Because some of the charges from these programs show up as relatively low monthly fees on a person's credit card statement, they can "fly under the radar" and go undetected by some consumers for months, Swanson said.
"The irony here is you have the credit card company initiating the fraudulent charges," Swanson said.
Matthew Towson, Discover senior manager, community affairs and media relations, said Discover does not comment on pending litigation.
He emailed The Forum a statement which reads, "It's not in Discover's interest to sell a product that doesn't enhance our relationship with our cardmembers. Many cardmembers find Discover's protection products valuable as they provide peace of mind. Discover seeks to maintain long-term relationships with our cardmembers, and for that reason, we have enjoyed the highest level of customer loyalty among leading credit card brands for 13 years."
Swanson is seeking injunctive relief, civil penalties and restitution with her lawsuit.
Engler is glad to see action being taken against the big credit card companies.
"I think it's maybe time somebody wakes up these credit card companies," he said.