- Personal Finance
CROOK ALERT!! Credit Card Companies Dropping Some of Their Indefensible Charges
Is that a knife in JP's left hand?
Carl Levin, U.S. Senator from Michigan
Chris Dodd, U.S. Senator from Connecticut
Credit Card Companies Dropping Some of Their Tricks and Traps
Credit card companies were raked over the coals by U.S. Senators Carl Levin and Chris Dodd at hearings of the Senate Banking Committee recently and are responding by dropping some of their most offensive "tricks and traps" for cardholders. Among these are "double cycle billing" where interest is charged on the entire balance rather than the unpaid amount, universal default in which late payments on other bills are treated as if they were late credit card payments in order to jack up interest rates on unpaid balances, bait and switch tactics where creditors are lured to open accounts with 2% rates which are shortly jacked up to more than 20%; and "heads I win, tails you lose" mandatory arbitration policies. Credit card companies have been reported to earn more than 50 % of their profits from such unscrupulous practices.
Here's an article on recent developments from the Detroit Free Press 3-22-07:
Here are Senator Levin's keynote remarks on credit card abuses for the Policy Forum on Credit Card Markets.