US Senate Committee Hearing on Credit Card Practices
by Mr Credit CardThe US Senate Committee on Banking, Housing, and Urban Affairs is holding hearings with credit card issuers and consumer advocate groups about credit card practices last Thursday. Credit Card issuers like Capital One, Barclays and JPMorgan Chase appeared before the committee. The biggest issue that the Senate Committee will be lookingat are hidden fees and predatory practices.
One interesting topic that came up was the theme about Universal Default Clause. This is the clause where credit card issuers can increase your apr simply because you paid a bill late to another creditor. But credit cards can increase your apr simply because your late payment to another creditor (which may have been a one-off event) is reported to the credit bureaus and picked up by your credit card.
Banks who practice this include Washington Mutual, Chase and Citibank. Representatives from Capital One claim they do not practice and apply universal default clauses in their credit cards.
I will be following this hearing and reporting any interesting news closely. You can watch the video or read the text speeches on this hearing here
February 1st, 2007 at 1:01 pm
I will be waiting to know what happened to that hearing, how fair it is to increase a person’s APR simply because of that person paid a bill late to another creditor……….
March 7th, 2007 at 5:09 pm
THIS IS WHAT THE CREDIT CARD INDUSTRY DID TO ME AND MY BUSINESS.
We are the owners of A&B Enterprises dba Fantasyline. We had been in business for 23 years. Our business was adult talk lines. We have always used live operators to screen our callers and verify bank information. We had excellent fraud control and verification procedures. Our primary form of payment was VISA and MasterCard. We had various merchant accounts. Initially we had merchant accounts with banks. At some point these banks discontinued telephone order processing and or credit card processing so we switched to third party processors etc. Our merchant accounts never had a bad mark against them. They were never cancelled due to chargebacks.
Our last processor was Online Data in Westchester IL. In December 2004 they informed us that they had to switch our account. In April 2005 they stated they could not switch our account because we sold downloadable DVD’s. This was false. We enclosed a letter to that effect to Online Data. The letter did no good and Online Data informed us that due to the nature of our business they could no longer process our charges.
Online Data recommended we contact Nelix to find a merchant account. Nelix refereed us to ECS World UK. This arrangement did not work out as ECS World UK failed to pay us monies owed.
Due to the loss of our merchant account we had to close our business. Online Data claimed that they were being forced to close all Adult Oriented Web Businesses by Visa and Mastercard International and Chase JP Morgan Bank. Fantasyline never was a Web Business. Closing our business abruptly caused us severe hardship.
All deprived us of our livelihood. Aside from depriving us of our livelihood and the complications that caused, we always paid high merchant fees.
Marcia Siegel
marciasiegel2004@yahoo.com