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A class action against credit card companies March 13, 2008

Posted by dorigo in news, personal, travel.
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Amidst the pile of junk mail I have to sort out in my mail box every time I visit Fermilab, I found a rather uncharacteristic request, from the US District Court Settlement Administrator. It claims I am eligible to receive a Court-approved refund of fees charged to my VISA debit card, based on foreign transactions I made from 1996 to 2006, and it invites me to submit a refund request in case the class action is won against the credit card companies.

Digging a little in the matter, I found out what this is about. Basically, for ten years VISA, Mastercard, and other companies, overcharged transactions made abroad by cardholders, by concealing 1 to 3% fees and other dirty tricks. The behavior you would expect from such pirates, of course. The novelty is that a class action appears to be winning the case against them, and will make them lighter by some 313 million US dollars if that happens.

The funny thing is why I am part of this, and the extent. I have had during those years a VISA debit card because I had a bank account in a bank close to Fermilab. I used the account very little, except during the two years I spent at Fermilab full time, in 1999-2000. Other than that, the card stayed dormant, and I only occasionally used it for purchases outside the United States. So, how much can VISA have taken from me fraudolently ? Maybe five dollars, maybe ten, all in all. Regardless of that, I have the option to claim a refund based on the time I spent outside the US, without the need to specify the use I made of the card: they will compute an average refund from the number of days spent abroad. But that number, in my case, is of the order of 2500! If they were to compute a refund based on that figure alone, I think they would come up with at least a grand…

It would be great to strip VISA of a little cash. I filled my form and here I am, patiently awaiting the outcome of the trial…

Comments

1. Kea - March 14, 2008

Gee, there’s something wrong here somewhere, but good luck to you. I am at present incredibly grateful to my bank for actually issuing me with a new VISA card. I can’t imagine why they did, because I can hardly afford to go further into debt.

2. Tony Smith - March 14, 2008

I received a similar notice a while back, probably based on trips to Europe around that time frame, so the overcharges were evidently widespread common practice.
It makes me wonder how many other disguised rip-offs have gone on (and/or are still going on),
and
makes me quite unsympathetic to the USA-dominated financial structure that seems now to be in the process of collapsing like a house of cards.

According to a 13 March 2008 article by Damian Reece on Telegraph.co.uk:
“… The Fed, with its latest $200bn [billion] offer of cheap cash, has provided yet more state aid for errant hedge funds and another Washington-backed bail-out for Wall Street bankers … The Fed has saved the day again, but it will only be for a day or so…
We have not seen anything like it since the decade of the Great Depression. …
How much further can the central banks go to support a system that is so obviously broken? …”.

The magnitude of the problem is stated in a 14 March 2008 article by Ambrose Evans-Pritchard on Telegraph.co.uk:
“… The market was starting to question the solvency of bodies that stand at the top of the credit pile. These agencies together wrap or insure $6 trillion of mortgages. …”.

If only 1/6 (about 17 per cent) of the mortgages are bad,
then the total amount needed for a bailout would be $1 trillion.

The true situation might be much worse – the complexity (and unjustified assumptions) of hedge-fund maths is so extreme that the bankers/hedge-fundies themselves do not even know the true status of the mortgage-based stuff they themselves hold.

Therefore, a mere $200 billion patch is probably as ineffective as pissing into the wind of a hurricane.

Tony Smith

PS – Do not expect any rational solution from USA politicians (including the three current major presidential candidates)
because they all get big campaign money from USA bankers/hedge-fundies whose sole interest is to be bailed out of responsibility for their greed and stupidity by taxing the citizens, if not by direct taxation, then by dilution of savings and inflation resulting from creation of trillions of dollars to be given to the bankers/hedge-fundies.
Maybe the USA and its dollar deserve to lose the position of hegemonic ruler of the Earth, and maybe China and/or EuRussia will take over and do a more responsible job.

3. anon - March 14, 2008

Hi there, which one did u fill up, the red or the blue? the red one is kind of a pain…

4. Jay Gaines - March 14, 2008

There’s another way to strip them of cash that I’ve been doing for quite some time–using 0% interest swaps. (on my website I’ve put some more details about it)

5. dorigo - March 16, 2008

Hi Kea,

good luck to you with your visa… I think banks are only happy if people get indebted. Spend wisely, I hate their lucrative business.

CHeers,
T.

6. dorigo - March 16, 2008

Tony,

thank you for your insightful comment, as usual I share your view on what you say. I think we are in the same class action – the letter I received was waiting for me in my mailbox since at least a month, and is probably the same one you got.
As far as the US economy going down in favor of China, that will probably happen sooner or later, but I do not believe there will be any benefit at our end.

Cheers,
T.

7. dorigo - March 16, 2008

Anon, I filled option 2, the one where you can specify the number of days you spent abroad. I found it quite easy to fill out- actually, even too much. I did it online though. Maybe the written one is not so straightforward ?

Jay, 0% interest swaps ? I will read what you have to say about it, it does ring no bell here.

Cheers,
T.

8. euclidistheway - March 16, 2008

Yeah, good for you Dorigo. I have been saying this all along (I know I am not the only one). In America the Corporations are nickle and diming fees to the consumers. Administrative fees, x-fees, weird fees and who knows what fees. This a conspiratoral creeping Piracy. Congrees will not address this because I guess that they are part of the problem. Think of it, a 25 cent fee tagged to 10 million customers for a monthly fee is $ 2.5 million. Easily pure profit. That ’s really not the worst of it. Try getting information from corporations, governments from the telephone or their websites. Time killers, which mean they don’t care how you waste your time (which may be money for you) which contributes to billions lost for the workplace and the family. Increasingly it looks like corporations don’t like to publish headquarter information or location anymore as they prefer to exist in cyberspace now. Now corporations are Global and all governments cater to them; they are not American, Italian, Russian, Chinese, British or whatever. They are in Dubai or other wealthy subsidised kingdom where they pay little tax and where the executives and their families feed from the fat in exotica. Halliburton was once an American corporation wave flagging and all.

9. changcho - March 18, 2008

Interesting – I received the same form. We shall see what comes out of all this.

10. Micky Multani - May 6, 2008

I doubt it. They have all the cash they need to buy the wining decision. You should watch the documentory…what was it called…maxed out on credit..very informative

11. dorigo - May 6, 2008

Hi euclid,

yes – the time killing process of contacting corporations is one of the things that is most bothersome. They are supposed to provide a service, and instead you find yourself wasting your time.

Micky, if you have a link to the documentory please post it…
Cheers,
T.


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