Discover Misled Investors About Compliance Failings, Suit Says

Discover Financial Services and its top executives allegedly misled investors about risk management and compliance protocols for its student loan and credit card businesses, a proposed class action suit filed Friday says.

The company allegedly concealed compliance issues for more than four years, filing disclosures that failed to mention deficiencies in the company’s internal procedures and resulting compliance failures, according to the complaint filed in US District Court for the Northern District of Illinois.

Those alleged deficiencies included compliance issues with student loan servicing standards, the misclassification of credit card accounts, overcharged customers, and a failure to stem Discover’s increasing ...