The nation’s largest privately held bank sold its credit card customers on add-on programs intended to help cover their accounts when they faced unexpected hardships. However, the Consumer Financial Protection Bureau says the bank deceived customers about the reality of these and other programs and has ordered it to provide nearly $28 million in relief to hundreds of thousands of affected cardholders.

Starting back in 2002, the First National Bank of Omaha began offering protection plans to its credit card customers with names like “Secure Credit” and “Payment Protection.”

The idea was that customers would pay a monthly fee (0.89% of the balance on their card at each closing date). In return, if they were suddenly faced with a qualifying hardship that prevented them from being able to keep up their payments on their card account, the program would make a monthly payment to that account to keep it from amassing significantly more debt or going into default.

Products like these are nothing new, but the CFPB alleges that in Jan. 2010, First National began a misleading telemarketing campaign to trick customers into signing up for these programs.

First, whenever a customer would call in to activate their new card, the customer service rep would start a sales pitch by saying “While your card is activating…” This, argues the CFPB, gave customers the false impression that they had no other choice but to listen to the upsell spiel because they had to wait for their card to be activated.

However, the CFPB says the activation process was “nearly instantaneous,” meaning the bank was merely using this bogus delay as a pretense for marketing an add-on service.

Bank reps would also refer to the programs as “an important account feature” or “our way of

saying thanks,” when neither were true.

Customers were also enrolled in these programs without their full knowledge or consent, claims the CFPB. These customers were not told that by agreeing to receive a “welcome kit” with the product’s terms and conditions, or by verifying their city of birth with the rep, they were actually signing up for monthly payments.

The Bureau says that First National reps sometimes told customers they were eligible for these programs without having done any checking to see if that was true. Likewise, some reps enrolled customers even after learning information that suggested the customer would not be eligible for one or more of the benefits of these programs.

All of this might not have been that big of a deal if customers could easily cancel their enrollments, and indeed First National’s marketing of these programs said they could be canceled “anytime,” “immediately,” and with “no questions asked.” Similarly, customers were told over the phone that they could cancel within 30 days at no charge.

“In fact, cancelling Respondent’s Debt Cancellation Products was not easy,” writes the CFPB. “[First National’s] customer service representatives often rebutted Cardholders’ requests to cancel several times before agreeing to cancel the Cardholders’ enrollment.”

According to the Bureau, the bank actually rewarded customer service reps with a “save bounty” for each time they prevented a customer from canceling their add-on service.

Okay, so you didn’t sign up for it, can’t cancel it without begging, but at least you’ll get those benefits when you get slammed with medical bills and can’t keep up with the credit card… right?

Not according to the CFPB, which says that First National’s practices “prevented the vast majority of Cardholders from obtaining several of the promised benefits” through the use of “restrictions, eligibility requirements, exclusions, and administrative hurdles.”

If you worked part-time (fewer than 30 hours/week) or were self-employed, good luck getting the benefits. Taken out of commission by a medical condition that was discovered up to six months after signing up for the protection plan? That counted as a “pre-existing condition” to First National. Your illness or disability caused by or related to pregnancy, childbirth, alcohol, drug use, or self-infliction? No benefits for thee.

Even if you were eligible, you sometimes had to jump through hoops to get the benefits. If you needed the protection plan because you were unemployed, you had to wait until you were out of work at least 30 days but you had to file your benefits application within 45 days of losing your job. Miss that 15-day window and you were denied.

Ill or disabled cardholders had to provide the bank with monthly verifications from their doctors. If your financial hardship was caused by an accidental death, you needed a death certificate that expressly stated “accidental death” as the cause of death.

Many of these requirements, says the CFPB, were not disclosed to users before they were enrolled in the programs.

The bank also sold a pair of credit-monitoring products dubbed “Privacy Guard” and “IdentitySecure” that were supposed to monitor the cardholder’s credit for potential identity theft or fraud, along with providing the accountholder with a copy of their credit report.

However, the CFPB says that the bank didn’t properly process customers’ authorizations, meaning the credit reporting agencies weren’t fully matching the customer with their information. Thus, many people who paid for this program did actually not receive the promised credit-monitoring services.

The bank has ceased the practices cited by the CFPB, but it’s not off the hook financially. It owes $27.75 million in relief to 257,000 customers affected by these practices. First National must also pay a $4.5 million civil penalty.

“First National Bank of Omaha violated the trust of its customers by illegally signing them up for credit card add-on products,” said CFPB Director Richard Cordray in a statement.