The Premiere One credit card offered by First Premiere Bank of South Dakota was fraudulently marketed to consumers as a credit card when it was actually a stored-value debit card, according to the Federal Trade Commission. The FTC filed suit against the bank and telemarketing companies it had hired, charging them with involvement in a scam that targeted people with poor credit.Continue Reading
The FTC complaint stated that consumers were charged as much as $174 for the false credit card and then pressured to sign up for additional services that cost up to $100. Charges were made to consumer bank accounts via electronic transactions without consumer authorization, and the companies engaged in a pattern of behavior designed to frustrate consumer's attempts to get refunds and cancel their accounts. The FTC halted the operations and froze the defendant's accounts in 2003.
In 2005, the telemarketing companies settled the lawsuit with the FTC, according to the Iowa Attorney General. First Premiere Bank entered into an agreement with the Attorneys General of Iowa, Minnesota and South Dakota to cease engage with such telemarketing businesses. First Premier Bank of South Dakota continues to offer other credit card products. In 2010, Consumer Reports named the First Premier Bank MasterCard "the nation’s worst credit card," according to an article in The Daily Beast.Learn more about Credit & Lending