Wednesday, December 1, 2010

CU Member Files Lawsuit Over Gift Card Fees

A class action lawsuit has been filed against Visa, Services Credit Union and 1st MidAmerica Credit Union alleging that these companies failed to disclose administrative fees for gift cards.

The plaintiffs, Karen Rhodes and Gene Rhodes, allege that the defendant companies deducted administrative fees before the "valid through" date, making the cards worth less than face value. The lawsuit was filed in Madison County Circuit Court.

Karen Rhodes claims she bought a gift card for her father-in-law that had a $50 value with a valid thru date printed on its face. Unknown to her, the actual value of the Visa Gift Card was only $35 at the time she purchased it because the defendants had imposed administrative fees of $2.50 per month before she even bought the gift card. When her father-in-law went to use the card it actually had a value of $2 due to the application of monthly administrative fees.

The suit claims that the credit union violated the Illinois' Consumer Fraud and Deceptive Business Policies Act.

The lawsuit is asking the court to declare a class action for everyone who bought gift cards from the credit union around the same time and to repay the members the costs of the administrative fees.

1 comment:


The content is provided for educational purposes only, with the understanding that neither the authors, contributors, nor the publishers of this site are engaged in rendering legal, accounting or other expert or professional services. If legal or other expert assistance is required, the services of a competent professional should be sought.

Comments appearing in response to articles appearing on this site do not necessarily reflect the views of the ABA. ABA makes no representations regarding the truth or accuracy of commentary or opinions that may be posted in response to the articles that appear on this website.

The inclusion herein of any link to a website, either in the text of an article or in a comment, does not denote any approval, sponsorship, or endorsement by the ABA, and ABA is not responsible for the content or opinions expressed on those linked websites or related commentary. This content is not licensed to third parties sites and is not affiliated with any third party site. Any reference to the author or this content on any third party site on the Internet is not authorized by the ABA.

It is the policy of the American Bankers Association to comply fully with all antitrust laws. Certain discussions should be considered off-limits, including those that contain competitively sensitive data such as price and cost information, or statements that could be construed as reflecting an attempt or desire to control or influence a particular market or markets. Future pricing or other prospective competitive information should never be shared.