NCRC And 110 Organizations Urge Regulators To Block Capital One-Discover Merger In Detailed Comment Letter

Capital One’s pattern of targeting vulnerable communities for products that trap them in debt cycles should disqualify it from acquiring Discover, 111 advocacy organizations wrote in a formal comment letter urging regulators to block the merger.

“[T]his merger would reduce options for financially vulnerable customers and reduce the already limited competition on pricing for non-prime credit cards,” the National Community Reinvestment Coalition (NCRC) and 110 co-signers wrote in the letter. “Capital One is also an industry leader in filing debt collection civil suits [which] often create financial emergencies where customers are forced to let other bills go unpaid, further trapping them in a vicious cycle of debt.”

The full letter can be read here. It makes detailed arguments about the proposed deal’s effects on competition, community needs, the banks’ own soundness and the structural stability of the wider financial system.

“Capital One gets half its profits from interest payments from people who’ve been unable to repay what the bank loaned them – and that’s just the way they planned it,” said Jesse Van Tol, President and CEO of NCRC. “Capital One hunts for those borrowers in the same streets and neighborhoods where NCRC members work every day to promote economic opportunity. The bank’s high-tech system to identify ‘soft targets’ and bombard them with credit card offers has earned Capital One admiration from its industry peers and shareholders, but I hope the regulators who taxpayers trust to protect us will take a very different view.”

NCRC’s comment letter is the latest in a series of actions the coalition has taken to stop a merger that would worsen pervasive inequities to enrich insiders. The group has also urged regulators to hold public hearings, highlighted Community Reinvestment Act concerns and flagged serious misconduct by Capital One.


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