Creditor Abuse Of Consumers

I know this is a bankruptcy blog, which is a way abusiveDEBTcollector

to get rid of most, if not all, creditors.

But these creditor abuse stories just keep

coming and coming.

First up this week:  Sub-prime credit cards

Sub-prime cards are those with small limits, for people with, bad credit.

Lots of them are folks who just filed bankruptcy, who think they need a credit card.

HEY!!! YOU DON”T!!!  Need a credit card, that is.

Get a debit card limited to whatever is in your account.

Along with the low limit comes high interest rates and fees.

But there are laws limiting those fees.

You might think $75 fees on a card with a $300 limit would be enough.

That is 25% right there, apart from the interest rate charges.

The CFPB said that Continental Finance Co. LLC, a card issuer headquartered in Newark, Delaware, issued subprime credit cards that typically had a $300 credit limit, which meant the maximum Continental could charge customers in fees during the first year was $75, or 25 percent of the credit line, a limit set by the 2009 Credit Card Accountability, Responsibility and Disclosure (CARD) Act.

But this company added on $4.95 per month if you wanted paper statements.

Of course, the default was to charge you the $4.95, unless you opted out.

And they caught another one:

On Tuesday (Feb. 3), the CFPB announced a settlement with Union Workers Credit Services, which allegedly charged a fee to thousands of customers for what it claimed was a general purpose credit card that could actually only be used to buy products from the company. Union Workers Credit Services agreed to pay a $70,000 fine without admitting guilt

Up second:  Debt Collectors Faking being from the New York Attorney General’s office

That oughta scare people!!

We have recently seen an uptick in the number of consumers targeted by scammers impersonating attorneys from my office,” said Schneiderman. “Keep in mind that government agencies will never threaten you harm over failure to pay a debt and will never solicit personal information over the phone. If you believe you have been contacted by a fraudster posing as a government official, please report it immediately so that we can bring these scammers to justice.”

Scammers are reportedly contacting consumers by letter, often received as a PDF attachment to an email, which appears to be signed by an actual New York attorney. The letter sometimes pressures the consumer into sending payments via “FTC regulated vouchers” or PayPal.  The letter also directs consumers to call a New York number with a 347 or 646 area code or another number that appears to be based in another state. Yet these numbers may actually connect consumers to someone outside of the United States.

Such representations violate the Fair Debt Collection Practices Act.

If you want creditor abuse to stop, contact me.

Well, enough creditor abuse for one week.  More to come!

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