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HSBC Bank US, NA penalized $35M for unfair billing practices

McLean, VA
Fine Amount: 
$35 million plus restitution
Penalty Type: 
Issued by: 

The Office of Comptroller of the Currency announced today that it has assessed HSBC Bank US, N.A. a $35 million civil money penalty (CMP), and ordered the bank to make restitution to harmed customers.

The OCC found that the bank’s billing practices violated Section 5 of the Federal Trade Commission (FTC) Act, 15 U.S.C. § 45(a)(1), which prohibits unfair and deceptive acts or practices. The $35 million civil money penalty reflects a number of factors, including the scope and duration of the violations and financial harm to customers from the unfair practices.

Customers eligible for restitution include those who were unfairly billed for CreditKeeper, a credit-monitoring product marketed and sold by the bank, its affiliate HSBC Bank Nevada, N.A., Las Vegas, Nevada, and their vendors. The restitution will benefit customers who enrolled in and paid for the credit-monitoring product between January 2004 and May 2012, but did not receive the full benefit of the product. The restitution will include the full amount paid for this product, plus any associated over-limit fees, finance charges, and interest. The bank was also directed to improve its supervision of third-party vendors associated with add-on products, development a risk management program for such products marketed or sold by the bank or its vendors, and develop a consumer compliance internal audit program for add-on consumer products.

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