Class Claims HSBC Cheats on Settlements

TRENTON, N.J. (CN) - One of the nation's biggest credit-card companies has found a new trick to squeeze money of out its customers, according to a federal class action. The class claims that HSBC Card Services makes settlement agreements with debtors' attorneys, then "accepts all but the remaining few payments" from the debtor and "unilaterally and without cause refuses to accept the remaining payment and instead deems the settlement null and void."

Lead plaintiff Chastity Bradley claims that HSBC's "mistreatment of plaintiff and the class was in fact indiscriminate, occurring in the regular course of defendant's debt collection attempts whereby plaintiff was treated in the same general manner as it treats other consumers who are the objects of its collection efforts."

Bradley says that in January 2010, through her attorney, she entered into a debt settlement agreement with HSBC for a past due credit account with a balance of $481. She says the bank promised that the account "would be settled and closed" after they received all her payments.

Bradley says HSBC accepted and deposited all her payments on the settlement except the final one, which it returned "without explanation and insisted upon collection of the full balance due, in total disregard of the settlement agreement."

The class claims that HSBC defrauds customers and breaches contract by its calculated policy of accepting "all but the final payment and proceed[ing] to declare the settlement void."

She seeks punitive damages for the class. She is represented by Bruce Warren with Warren & Vullings of Jenkintown, P.A.

Class Claims HSBC Cheats on Settlements

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