U.S. Bank's $6.5 Million Is Just the Tip of the Iceberg

The Consumer Financial Protection Bureau recently ordered U.S. Bancorp (NYSE: USB  )  and its partner Dealers' Financial Services (DFS) to return $6.5 million to military service members. The CFPB uncovered unfair marketing practices and fees designed and implemented by DFS.

For U.S. Bancorp, a fine of this magnitude is nothing more than a slap on the wrist. However, it is a harbinger for change in how regulators view third-party relationships. Banks will now have to think long and hard about outsourcing, even to reputable companies like Jack Henry and Associates (NASDAQ: JKHY  ) and Fiserv (NASDAQ: FISV  ) . 

In the video below, Motley Fool contributor Jay Jenkins discusses the signficance of this fine and what it may mean for banks and the third-party companies who provide outsourced services.

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Related Tickers

9/27/2016 4:00 PM
FISV $100.61 Up +0.36 +0.36%
Fiserv CAPS Rating: ****
JKHY $86.57 Up +0.17 +0.20%
Jack Henry and Ass… CAPS Rating: *****
USB $42.90 Up +0.43 +1.01%
US Bancorp CAPS Rating: ****