The Federal Deposit Insurance Corporation has ordered Merrick Bank to pay $16.1 million to settle charges related to the marketing of a credit card add-on product. According to the terms of the settlement agreement, Merrick will pay a $1.1 million penalty and $15 million in restitution costs stemming from violations of the Federal Trade Commission Act.

At issue in the case is a third-party service called the “PAYS Plan,” which was designed to provide monthly credit payments during unexpected life events such as unemployment or hospitalization.  The benefit plan was marketed to Merrick’s credit card customers between 2008 and 2013.  The FDIC charged Merrick with misrepresenting the plan’s protections for consumer credit ratings.  It also accused the bank of failing to disclose the terms and conditions of the plan’s hospitalization benefit.

The $2 billion-asset Merrick, which is based in South Jordan, Utah, serves more than 900,000 cardholders, and also provides financing for boat and RV dealers.