The Great Credit Card Scam - Rep Bernie Sanders

[RamboLiberal]

http://bernie.house.gov/documents/articles/20041201145027.asp

TODAY'S LOAN SHARKS are no longer lurking on street corners or hiding in alleys, breaking knee caps to collect their payments. They now wine and dine with the president and other powerful political leaders, wear Armani suits, make hundreds of millions in total compensation and head banks like Citigroup, MBNA and Capital One. The old-fashioned loan shark was a common criminal who broke the law. The modern loan shark, through campaign contributions and political connections, writes the law.

At a time when interest rates have been historically low, credit card issuers made a record breaking $30 billion in profits last year by charging usurious interest rates and sky-high fees. Millions of financially strapped credit card holders are now being forced to pay 15 percent to 30 percent interest rates and hundreds of dollars a year on late fees and other add-ons. Like the loan sharks of old, credit card companies lie, deceive and destroy lives in the process.

Meanwhile, as credit card issuers rip off middle-class Americans through deceptive and unfair tactics, the CEOs are laughing all the way to their banks. Over the last five years, the CEO of Citigroup (Sanford Weill) made more than $500 million in total compensation and the CEO of Capital One (Richard Fairbank) made more than $169 million in total compensation. In 2002 alone, the top four executives at credit card giant MBNA made more than $300 million in total compensation.

One of the most egregious ways that these modern-day corporate loan sharks make their bloated profits is through the credit card interest rate "bait and switch." Just check your mailbox today and you'll probably find one of the 5 billion credit card solicitations (the actual figure) that the companies bombard consumers with every year. What you'll see on these advertisements in bold print are attractive offers promising low interest rates of 4 percent, 6 percent or sometimes even zero percent. That's the bait. But, what you probably won't notice is that in the very fine print at the bottom of a multi-page contract written in undecipherable legalese is language that essentially allows the company to raise their rates at any time for any reason. That's the switch.

[serryjw]

1. It gets worse.........

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Mind those bills. All of them. A late payment on one account could cost you higher rates and fees on all your accounts -- from your credit cards to your auto insurance. More and more companies are peeking at credit reports regularly to justify raising interest rates or increasing credit limits.
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Most people TRY and pay their Mortgage on time....BUT if they pay ONE CC late it could easily affect ALL interest charges on ALL your cards!