Charges of deceptive marketing aimed at allegedly luring customers to pay illegal and excessive membership fees – and make it “unreasonably difficult for consumers to cancel memberships and obtain refunds – are part of a lawsuit brought by the federal consumer financial protection agency against a Pennsylvania firm, the agency said Friday.
According to the Consumer Financial Protection Bureau (CFPB), Horizon Card Services of Indiana, Pa., and its CEO Robert Kane tricked consumers into signing up for its expensive membership credit card. The agency alleged that the card could come with almost $300 in annual fees with a $500 credit limit, and that it could only be used to purchase goods “from the company’s overpriced online store and nowhere else.”
The agency said its lawsuit seeks a stop to alleged unlawful conduct, redress for harmed borrowers, and the imposition of a civil money penalty (CMP). The agency’s complaint did not detail the amounts it is seeking in redress or in a CMP.
CFPB said Horizon offered consumers enrollment in a membership that included an unsecured, open-end line of credit. The line of credit typically started at $500 or $750, the agency said. The company marketed its credit line under numerous brand names, including Boost Platinum Card, Freedom Gold Card, Group One Platinum Card, Horizon Gold Card, Independence Gold Card, Innovation Platinum Card, Merit Platinum Card, Net First Platinum Card Principal Platinum Card, and Focus Gold Card.
The company was founded in 2005 by Robert Kane, the CFPB said, who, in addition to being the founder, is the CEO and sole shareholder and oversees day-to-day business operations.