The state of Hawaii has sued seven major credit card issuers over the marketing of credit card insurance-like products, known as payment-protection plans.
The lawsuits, filed April 12, allege the companies have illegally charged unknowing customers for the products and have failed to provide adequate plan benefits.
Bank of America Corp,., Barclays, Capital One Financial Corp., JPMorgan Chase & Co., Citigroup Inc., Discover Financial Services and HSBC are all named as defendants in separate filings.
Hawaii Attorney General David Louie filed the lawsuits along with a local attorney and two plaintiffs' firms, Golomb & Honik of Philadelphia and Baron & Budd of Dallas.
"The defendants commit unfair and deceptive business practices and violate statutory law by charging consumers for ancillary products, including payment-protection plans, who either did not want them or were not entitled to benefits from them, and by the unfair and deceptive manner in which defendants offer and administer claims for benefits by consumers," according to the Hawaiian lawsuits.
Cap One, HSBC, Barclays, Citigroup and Discover declined to comment. BofA and Chase did not respond to requests for comment.
Payment-protection products are designed to suspend or cancel credit card debt in the case of injury, illness or other major life event.
Hawaii is asking for an injunction to halt any illegal practices and is seeking restitution for affected customers, according to the lawsuits.
The suits are similar to earlier complaints by attorneys general in Minnesota and West Virginia. Their lawsuits alleged that card issuers were illegally marketing their credit card payment protection plans.
Discover, the only defendant in the Minnesota suit, settled for $2 million in November.
The West Virginia attorney general sued nine banks, including Discover, in August on similar allegations. Missouri's attorney general submitted a request for information to Discover that same month, the company previously disclosed in regulatory filings.
In January, Discover disclosed it was facing a joint enforcement action by the Consumer Financial Protection Bureau and the Federal Deposit Insurance Corp. over its marketing of lucrative but controversial credit card payment protection plans. In February, Discover said it believed its relatively new practices would appease regulators.