On December 17, 2014, the Consumer Financial Protection Bureau (CFPB) sued Union Workers Credit Services, a Dallas-based company that allegedly deceived consumers into purchasing a sham credit card with a membership fee. The CFPB’s complaint charges the company with falsely advertising a general-use credit card that, in actuality, could only be used to buy products from the company. According to the CFPB, the vast majority of the company’s revenue is generated from selling this “buying-club” membership card that it falsely advertised as a general-purpose credit card. Most consumers never use the membership card but cannot recoup their membership fees, which amount to $37 if they apply through the mail or $95 if they apply online. The lawsuit also claims that Union Workers Credit Services deceptively implied an affiliation with unions, including using pictures of nurses, firefighters, and other public servants in its advertising.

“The business model for Union Workers Credit Services is built on duping consumers into signing up for a sham credit card,” stated CFPB Director Richard Cordray in an announcement. “Hundreds of thousands of people, including a great many union members who were specially targeted, have been tricked into spending millions of dollars for a so-called credit card that can really only be used to buy the company’s own products. From the misleading photos of nurses and firemen on its website to its bogus credit card, Union Workers Credit Services is illegally deceiving consumers.”

The CFPB’s lawsuit seeks compensation for victims, a civil penalty and an injunction against the company.