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Brian Patrick Cork is living the Authentic Life

extortion: credit card companies caught in the Act

October31

There’s a story floating around, and it’s a true one, that credit card companies are racing to raise interest rates before a new law designed to protect us from that very thing goes into effect February 22nd. You can read more about it here, for more ugly details.

Congress had actually been moving quickly themselves to form probably insipid meaningful legislation around the Credit Card Accountability, Responsibility and Disclosure Act, or CARD Act. But, and I have to add the word oddly, and should also add disappointingly, let’s also consider outrageously, allowed themselves to be lobbied by the credit card companies and approve a “grace period” that would enable the credit card companies to “prepare” for the change in predatory practices.

So, they’re using that grace period to gouge credit card users as hard, deep and quickly as they can.

Thank you, our ever vigilant, inspiring representatives.

The same representatives, mind you, that are voting in a healthcare package that they, themselves, are not required to participate in. Read about that in my post: healthcare is not for You.

The Act actually offers some fairly meaningful protection for credit card users. You can or should research those details elsewhere; it’s worth the time and effort. A meaningful issue at hand, however, is this grace period is going to create a lot of harm and financial chaos in the interim. It’s also going to cause, in many cases the very thing the Act was meant to forestall, if not eliminate.

I’m skeptical Congress could not have seen this coming. And, so, I feel set-up by them again.

We don’t use credit cards much in our household, or in my businesses. We prefer American Express (I certainly have issues with American Express), but when we need to use a credit card we prefer to pay it off. Apparently most Americans can’t or aren’t doing that, for the moment.

Nonetheless, I have a letter from Citibank informing me that they are doubling the interest rate on cards.

Right there in my hands I had written proof that the credit card companies; certainly Citibank, were attempting to extort the American people – and, Congress are their unwitting accomplice. /1

Where’s Aaron Burr when we really need him?

This is all a lot more insidious than the media are letting on, Congress will own up to, and, what most people might understand.

The letter I received from Citibank said, in effect, that I had an option to decline the higher interest rate. But, if I do so, they will cancel the credit card. For me, that’s not an issue. But, apparently for 63% of Americans, it just might be. If the credit card companies cancel the credit card, you are still, obviously, responsible for paying down the balance. Maybe that, unto itself, is not such a big deal, but the fact that your credit score will drop precipitously, is. Your credit score is driven by many factors (I suspect many of them subjective). But, an obvious factor is amount of credit card balance against available credit (your credit limit on the card). If you’ve maxed out your card, but are paying, at least the minimum required each month, your credit score will likely stay intact. But, if you have a credit ratio where your balances outweigh the available or potential available credit, your score drops up to 99 points in only one reporting cycle. NOTE: It comes down to algorithms (more profiling) designed by the credit industry exist to punish users if they tried to cancel their own cards.

It’s true; and, you better get pissed! I don’t mean inebriated here, but, that might help some of you that continue to numb yourselves against being bent over your own “American dreams” as they collapse around you.

I wish I had good news today. Maybe a fun story. And, I am trying to come up with a solution – if not a course of action. I honestly don’t know if writing, calling or visiting your Congressman does any good. We could go to Oprah, I suppose. But, she won’t make any move that might shed unfavorable light on Barack Obama. I don’t know if she’s his bitch, or the other way around.

Maybe we should try something like a “Don’t use your credit card for a week” campaign. What do you think?

Peace be to my Brothers and Sisters.

Brian Patrick Cork

1/ From: West’s Law:

  1. The act or an instance of extorting.
  2. Illegal use of one’s official position or powers to obtain property, funds, or patronage.
  3. An excessive or exorbitant charge.
  4. Something extorted.

extortionary ex·tortion·ar’y (-shə-nĕr’ē) adj.
extortionist ex·tortion·ist or ex·tortion·er n.

or,

From the Columbia Dictionary:

“extortion, in law, unlawful demanding or receiving by an officer, in his official capacity, of any property or money not legally due to him. Examples include requesting and accepting fees in excess of those allowed to him by statute or arresting a person and, with corrupt motives, demanding money or property unlawfully under pretense of duty. The taking of money or property is generally an essential element of the crime. In most states of the United States, extortion is more widely defined to include the obtaining of money or property of another by inducing his consent through wrongful use of fear, force, or authority of office; blackmailransom, and threat of force are included under this definition.”

5 Comments to

“extortion: credit card companies caught in the Act”

  1. Avatar November 4th, 2009 at 4:07 pm Aaron Says:

    This “grace period”, or as I would refer to it, the “screw ’em while you still can period” reflects at least one, if not both of the disgusting truths about those who have been elected to lead our nation:

    1. They are corrupt, and in bed with the very corporations that they are advertising their disdain for to the public
    2. They are utterly ignorant about human and corporate nature

    Of course, ultimately I don’t have an issue with the credit card companies doing whatever they believe will increase their bottom line. They don’t have a moral obligation per se; they have a capitalistic obligation within the confines of the rule of law. As consumers of such capitalism, we have our own choices to make on what we consume and what we don’t (notwithstanding the credit score impact, but there are ways to even skin that cat), and the capitalistic laws of supply and demand will cause the drive to an efficient market correct any imbalances.

    But what I do have a problem with is when our government and their media minions portray their actions as protectors of the people, when in most cases, the end result is just more controls without true economic nor social benefit.

    And this CARD act is such a travesty.


  2. Avatar November 4th, 2009 at 4:39 pm Brian Patrick Cork Says:

    You make some good points here Aaron.

    By the way… I’ve shared your views with the readers over on Paul Sunstone’s Cafe Philos. Paul offered up some questions around Capitalism: A Love Story.

    http://cafephilos.wordpress.com/2009/10/11/capitalism-a-love-story/

    I’ll likely disagree with, where I think, you wanted to go with credit scores. Because, as evil as credit cards are, it’s difficult to navigate our culture without them – and, the rules of engagement are, at best, cloudy. And, there is little interest, apparently, in advocating and/ or protecting citizens. In truth, seeing how out-of-touch Congress is with the average citizen, I see them as clear accomplices in this problem. So, that’s where you and I come back to common ground.

    Cork


  3. Avatar November 6th, 2009 at 1:10 pm Aaron Says:

    Lest I be misunderstood, I too recognize the necessity of credit cards, and credit in general, in order to function effectively in our society. My posit on the issue of credit scoring, however, can be at least managed through sound credit management even in the midst of ever changing regulation and banking policy. When American Express decreed, unannounced I might add, to change our credit line with the only reason being a new set of rules of which I could not be informed, we started using our other cards and opened up others at credit unions, whose policies have traditionally, and continue to be more consumer-friendly. While I still carry that card, my usage of it is on the downswing and my renewal dollars shall be diverted elsewhere upon my anniversary.

    Maybe to buy some more cool 80’s music…


  4. Avatar November 6th, 2009 at 4:50 pm Brian Patrick Cork Says:

    I walk with my friend and brother, Aaron.

    Cork


  5. Avatar February 4th, 2012 at 10:19 am Miss Lori speaks from the heart about the Susan G Komen Planned Parenthood saga | misslori.tv Says:

    […] work like slaves to the rich. How banks and credit card companies have practiced loan shark like extortion over people with barely two nickels to rub together, keeping them down, struggling in quicksand that continues to pull them under. How CEOs and Company […]


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