Credit One Bank to pay $10 million to settle lawsuit over debt collection calls

Credit One Bank has agreed to pay just over $10 million to settle a civil consumer protection lawsuit alleging the company or its vendors made repeated, intrusive and harassing debt collection calls, the Los Angeles County District Attorney’s Office said Friday, Feb. 20.

The Nevada-based company — which did not admit wrongdoing — was ordered to pay $9 million in civil penalties and $1.2 million in investigative costs in connection with the judgment entered Thursday in Riverside County Superior Court in a lawsuit filed by the district attorney’s offices of Los Angeles, Riverside, San Diego and Santa Clara counties.

The settlement also requires the company to comply with state and federal law involving consumer debt collection, according to the District Attorney’s Office.

The lawsuit alleged that Credit One had a policy that allowed its vendors to make eight calls per day along with an additional two calls per day under certain circumstances on overdue credit card accounts and that the calls could be placed on consecutive days.

“Credit card companies do not have the right to badger consumers and invade their privacy with non-stop phone calls to collect debt,” Los Angeles County District Attorney Nathan J. Hochman said in a statement announcing the settlement. “We are sending a strong message today that companies will not get away with harassing consumers in our state.”

The District Attorney’s Office said Credit One had previously been found liable by a federal jury in 2019 for violating the Rosenthal Fair Debt Collection Practices Act, which allows debt collectors to make calls with frequency that is reasonable under the circumstances.

The case stemmed from an investigation by the California Debt Collection Task Force, a statewide law enforcement team composed of the district attorney’s offices of Los Angeles, San Diego, Riverside and Santa Clara counties.