Oregon Department of Justice

Attorney General Hardy Myers today announced the filing of an agreement with national credit card issuer First USA/Bank One requiring the company to make sweeping reforms in its business practices in order to protect consumers. The Assurance of Voluntary Compliance, signed by First USA/Bank One but admitting no law violation, was filed in Marion County Circuit Court and is part of a 28-state and Puerto Rico settlement.

"Businesses selling their customer lists to telemarketers must insure that those companies deal honestly with these consumers and not use deceptive and misleading trade practices," Myers said. "This agreement will hold First USA/Bank One responsible for the way these telemarketers do business with its customers."

The agreement settles a two-year investigation led by attorneys general in New York, California, Ohio and Vermont looking at consumer complaints about the marketing practices of the defendants' business partners. The investigation revealed that since the mid-1990s, First USA/Bank One received a percentage of sales made by companies selling various products and services to bank customers. Consumers complained that deceptive pitches by these companies resulted in consumers being charged for products and services that they did not knowingly agree to purchase.

In some cases, telemarketers promoted free trial offers on dental plans or credit card loss protection service. When the trial period ended, consumers did not understand that the companies would charge their credit card for continued use unless the consumers cancelled during the trial period.

First USA/Bank One agreed to pay the lead states each $135,000 to cover the costs of the investigation. Oregon and other participating states will receive $26,041.

In addition, First USA/Bank One agreed to reforms that include:

• Prohibiting customer charges unless there is express authorization of the account holder.
• Requiring the bank to review and approve all telemarketing scripts and marketing materials.
• Requiring telemarketing firms to comply with all applicable consumer protection laws;
• And requiring clear and conspicuous disclosure of the identity of the telemarketing company if the script makes reference to First USA/Bank One.

Consumers wanting more information about this settlement and a similar agreement filed in February 2002 against Citibank may call the Attorney General's consumer hotline at (503) 378-4320 (Salem area only), (503) 229-5576 (Portland area only) or toll-free at 1-877-877-9392. Justice is online at www.doj.state.or.us.