LV-based bank ordered to pay credit card patrons
Tuesday, May 25, 2004 | 10:37 a.m.
The Office of the Comptroller of the Currency on Monday ordered the First National Bank of Marin -- a Las Vegas-based credit card bank -- to make restitution to customers harmed by alleged unfair practices.
While the bank did not acknowledge any wrongdoing in the order, the OCC ordered the bank to set aside at least $10 million to fund restitution payments to customers.
At the center of the order, the OCC said Bank of Marin was encouraging customers with bad credit to charge a required $200 security deposit to newly issued credit cards. The bank also was charging interest on that security deposit.
"After adding various fees that were also charged to the card, customers who received the bank's minimum credit line of $260 had only $2.50 in credit available for their use," the OCC order said.
With the order, the bank agreed to stop charging the deposits to cards issued by the bank and stop charging interest on the security deposits.
In a statement released Monday, Robert DeJong, the bank's chief executive, said the company fully discloses all of the terms of its credit cards.
"We pride ourselves on our open and honest communications with our customers," he said.
In 2001, the bank was required in a separate OCC order to establish a $4 million account to reimburse application and other fees to customers who canceled cards after finding out that there would be little available credit after those fees were assessed.
In DeJong's statement Monday, he said the OCC has certified the bank's compliance with the 2001 order.
First National Bank of Marin, which has about 500 employees at its Las Vegas headquarters and call center, was originally founded in Northern California's Marin County. The bank moved to Las Vegas in 1998.
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