The Scam Operators' Protection Act of 19XX?
One way to protect your rights in the United States (Sep 99)
I was planning to publish Part 1 of my article "How Jesus Christ viewed the Book of Jeremiah" this month, but another issue popped up which may be of more immediate concern for most Americans.
Unlike the situation during Jeremiah's ministry, in the United States today we are fortunate to have a variety of peaceful means available to bring about needed changes or to undo changes that need to be undone. In most cases, these means can be fueled simply by applying the power of truth to the situation. The following letters to the "Dispute Supervisor" of MBNA America and Attorney General Janet Reno illustrate some of these peaceful means. This particular issue concerns an assault that is presently being made on the consumer rights and "personal sovereignty" of every credit-card holder in America.
* * *
Dispute Supervisor, Customer Satisfaction Department 12 Sep 99
Individualized Bank Card Services
P. O. 15026
Wilmington, Delaware 19886-5026
Dear Mr. Dispute Supervisor,
Your company's eagerness to screw its customers has far exceeded my expectations. As shown in Attachment 1 (a copy of my latest statement for account #aaaa bbbb cccc ddd1), you have now charged that account an obscene $29.00 "late fee" for a payment due on 2 Sep 99 in spite of the fact that your statement clearly shows that your received my payment on 23 Aug 99. The ONLY reason that ANY "balance due" appears on that account in the first place is because your company has allowed what I believe may be a scam operation to continue making charges against that account WITHOUT MY AUTHORIZATION, despite my vehement objections, and in spite of the fact that this account has been closed since 29 May 99. I appreciate the fact that in August someone in your company apparently informed the entity that calls itself "AIG Mass Marketing" that I did not want to continue receiving their disability insurance and that I was VERY upset by their continued billing of my MBNA account after it has been closed (my own efforts to get them to stop have proven ineffective so far). But then on 25 Aug 99 your monthly statement shows that your company allowed them to make ANOTHER unauthorized charge against that account in spite of my specific written instructions prohibiting you from allowing them to do that. That is the third month in a row that you have allowed UNAUTHORIZED charges to be made against that closed account. That's three strikes--YOUR OUT!
So, in addition to my account #aaaa bbbb cccc ddd1 which I told you to close last May, I am hereby instructing you to CLOSE my MBNA "U.S. Air Force Academy AGG" account #aaaa bbbb cccc ddd2. In order avoid your company's nasty little practice of continuing to charge interest for the one week or so between the time you send your bills out and the time you receive payment for the FULL balance on your accounts (even though you claim in the back of your bills that your company won't do that), I overpaid on that account in August so as to more than cover any intervening accrued interest. Your company owes me a check for the unused portion of that overpayment.
I am also hereby instructing you to CLOSE my MBNA "Platinum Plus" account #aaaa bbbb cccc ddd3 AND its predecessor account #aaaa bbbb cccc ddd4 which until now I have been using for 99% of my credit card charges in recent years. I paid off the FULL balance on that account last month but have made some charges since then, so enclosed is an $600.00 check that will more than cover those charges and any interest accrued until now. Your company owes me a check for the unused portion of that overpayment as well.
Furthermore, I am including a $100.00 check which is more than enough to pay what you falsely claim is due on account #aaaa bbbb cccc ddd1 and any further interest accrued until now. Your company will also owe me a check for the unused portion of that overpayment. Eventually, by the time "the dust settles" on this issue, I expect that you will be reimbursing me for ALL of the payments and overpayments I have made to that account since May 99.
Since the concept of what it means to "close" an account seems to have eluded you people, let me draw you a verbal picture of what I mean by "close." "Close" means that once you have once you have sent me checks for the overpayments on the above accounts, NOBODY is authorized to make any further changes against those accounts-not MBNA, not any entity that has "AIG" in its name-NOBODY. If Bill or Hilary Clinton show up in your office and with a "Presidential Executive Order" that demands that changes be made against any of the above accounts, you are to tell him or her "Sorry, those accounts have been closed. That individual is no longer an MBNA America customer. We can't help you." If Jesus Christ returns to earth in person and materializes in your office to demand that charges be made against any of those accounts, you are to tell Him, "Sorry, those accounts have been closed. That individual is no longer an MBNA America customer. We can't help you." "Closed" means CLOSED! Get the picture?
I must admit that your $29.00 "late fee" for a $10.00 payment made on time against a total balance of $41.30 caught me totally by surprise. I must give you credit for a creative imagination in devising new ways to screw your customers. I guess, since your statement shows a "past due" of $20.00, you must have jacked the minimum payment up to $30.00 or about 73% of the total balance, so that in addition to the accrued interest, you could add that obscene $29.00 "late fee." What do you suppose the rest of your customers would think if they were to learn that it is a practice of MBNA America to offer an "introductory" minimum payment rate of about 2 percent of the total balance and then suddenly jack the minimum payment up to 73% of the total balance in order to increase MBNA's chances of collecting $29.00 "late fees"? You need not answer that question right now. You may to find that many of your customers will provide you with answers in the near future.
With regards to the entity that calls itself "AIG Life Mass Mrktng", as I pointed out in my 18 Aug 99 letter to you, on the afternoon of Wednesday, 11 August 99, I called the phone number that you gave me for that entity (1-800-248-6213) and someone whose name sounded like "Lorelei Glen" told me to call another 800 number (1-800-521-2773) which she said was in Delaware. So I called that number and explained to the woman who answered that I wanted to cancel my liability insurance policy immediately. She told me that should would cancel the monthly billings to my account and send me some forms to fill out to make the cancellation "official." Obviously, that lady who claimed to represent AIG Life Insurance lied to me about canceling those monthly billings, because two weeks later "AIG" once again "forced" an unauthorized charge against my closed account. About four weeks later, I finally did got a form to sign to cancel that disability policy. As far as I can recall, that was the first written communication I have received from "AIG Life" in over ten years-they never sent me an annual statement or notified me that they had changed their address and phone number or informed me that the company I originally started that policy will went out of business or whatever. So those people, who may in fact be merely some former employees who are running a scam operation that mimics AIG Life Insurance, demonstrated that in about four weeks they could create what appears to be an official AIG Life Insurance cancellation form. Attachment 2 is a copy of their form that I signed and returned to them. Will they send me a "cancellation number" in response? I doubt it. Will they continue to try to "force charges" against my closed account. Perhaps. I find the promise you made in your 30 Aug 99 letter to me stating that after 30 Aug 99, I will be able to collect reimbursements from your company for any further charges that they make against that closed account to be somewhat of a relief (at least you are no longer holding to the position that planned to honor their charges without reimbursing me ad infinitum), but that doesn't change the fact that you should NEVER have allowed them to make those unauthorized charges against a closed account in the first place.
It appears that the Delaware Attorney General M. Jane Brady's office has ignored my complaints about your conduct and the conduct of "AIG Life Mass Mrktng." Ms. Brady may find it more difficult than ever to get elected to a public office again when Delaware voters learn how little concern she apparently has for protecting their consumer rights. So now I am now preparing packages to send to Attorney General Janet Reno's Office, Common Cause, 20/20, NightLine, A&E Investigative Reports, various internet sites that are concerned about consumer protection issues, and the United States Air Force Academy Association of Graduates (who can easily find more suitable credit provider for your "U.S. Air Force Academy AGG" customers). I will give you until the end to this monthly to provide me with a copy of the so-called "law" (with the applicable paragraphs identified) that, as you claim, "requires" your company to honor charges made against an account that has been closed and in spite of the vehement objections and written instructions of the owner of that account. Frankly, I seriously doubt such a law exists, because politicians would be committing "political suicide" if they for such a flagrant violation of the consumer rights of every credit card holder in America (i.e. they would be accused of voting for a law that would become known as the "Scam Operators Protection Act of 19XX"). Furthermore, such a law would not stand up constitutionally, because unlike a government, private corporations (including yours) do NOT have a constitutional right for force Americans to pay for private services that they have not authorized and do not want (which is precisely what your company has been doing to me). Such a law would be morally, politically, and constitutionally untenable. But I've decided to give you this opportunity to provide me with a copy of such a law (if it exists). If you do, I'll include copies of it in the packages that I will be sending to the above addressees. If you don't, then on the evening of 30 Sep 99 I'll proceed on the assumption that such a law does not exist and that you lied to me about it in order to avoid reimbursing me for the unauthorized charges you allowed "AIG Life Mass Mrktng" to make against my closed MBNA account.
Finally, judging from the correspondence you have sent to me and the attitude you displayed towards me when I talked to you on the phone, I believe there is a need for me to illustrate to you a simple but poignant lesson in economics. Attachments 3 and 4 show that earlier this year, your company was earning around $156/month in interest per month from my "U.S. Air Force Academy AGG" account #aaaa bbbb cccc ddd2 and around $139/month from my MBNA Platinum credit card account #aaaa bbbb cccc ddd4. That's nearly $300/month in interest that your company was earning from me (around $3,500.00 per year). Shortly after you read this letter, your company will be earning ZILCH from me-ZIP-NOTHING! So even if you ultimately do succeed in extorting $110 or so from me with your unauthorized charges and obscene "late fees", your company is in fact NOW LOOSING nearly $300/month as a result of your attempts to screw me. For some reason, in spite of the name of your department, you don't seem to be the least bit concerned about the fact that that the money that pays YOUR SALARY comes from the checks which customers like ME send in every month-NOT from the vendors and potential scam operators that you apparently prefer to serve! So I have, in effect, terminated the employment your company as my credit provider;--in other words:
Christopher C. Currie (a HIGHLY dissatisfied and now FORMER customer)
Copies sent to:
American Civil Liberties Union
A M Best Company
And elsewhere after 30 Sep 99
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30 Sep 99
The Honorable Janet Reno
Attorney General of the United States
Main Justice Building
10th Street & Constitution Avenue, NW
Washington, DC 20530
Dear Ms. Reno,
1. I hereby formally request that the following two companies be charged with criminal misconduct.
a. AIG Life Insurance Company (and what now appears to its affiliate "AIG Like Mass Marketing")
600 King Street
P. O. Box 667
Wilmington, DE 19899
For repeatedly (in June, July, and August 1999) "forcing" changes to be made against my MBNA
Account aaaa bbbb cccc ddd1:
AFTER I had closed that account on 29 May 1999. When they discovered that I had closed that account, they could have (and should have) sent me a bill (I no longer had a valid address or phone number for them when I closed that account). Instead, they phoned MBNA and "forced" charges to be made against that closed account...
WITHOUT my authorization, and
IN SPITE of my written instructions to MBNA to NOT allow such charges to be made.
And then they continued to do that...
EVEN AFTER an AIG representative had told me on the phone that she was canceling my
(disability) insurance policy per my request and that no further changes would be made.
b. MBNA America
P. O. Box 15026
Wilmington, DE 19886-5026
For ALLOWING those charges to made
IN SPITE of the fact that account was closed.
IN SPITE of the fact that I had instructed them in writing NOT to allow such charges
And for using "late fees" and implied threats to my credit rating to EXTORT at least
$110.00 from me for services which I did NOT authorize and did NOT want.
When a government forces individuals to pay for services that they did not authorize and did not want, that is called "taxation." When individuals or private corporations force individuals to pay for services that they did not authorize and did not want, that is called "extortion." MBNA America is NOT a government!
What can the federal government do to a corporation that engages in criminal activities? Levy a large fine to discourage them from continuing to act that way? Jail their Chief Executive Officer for contempt if his corporation keeps on committing such crimes? I was just wondering.
2. As you will see from the attachments, MBNA's "Dispute Supervisor" told me on the phone that they were "legally required" to allow AIG Life Mass Marketing to "force" those charges, even on an account that has been closed. Personally, I doubt that such a law exists, because if Congress attempted to grant the powers reserved for governments to individuals and private corporations everywhere, such a law would not survive a constitutional challenge (neither would the politicians who voted for such a law). There are very few issues that would separate the Republican Party from its conservative constituents faster than such a legal assault on the consumer rights and "personal sovereignty" of every credit card holder in America!
3. However, if our Congress actually was foolish enough to enact such a law, I hereby request that you send me a copy of that law and identify the paragraphs in that law that grant individuals and private corporations the authority to engage in "legalized extortion" as described above. If such a law does exist, I intend to get it either repealed or declared unconstitutional..
4. Finally, as you will also see in the attachments, I originally submitted this complaint (by email) to the office of Delaware Attorney General M. Jane Brady. It appears that they have chosen to ignore my complaint. I had heard that the reason so many large corporations have their headquarters in Delaware is because the Delaware state government is "unusually friendly" to corporate interests. But I never imagined that "unusually friendly" would include turning a blind eye to corporate practices of criminal extortion. What do you suppose Ms. Brady's chances of getting re-elected will be when the voters in Delaware hear about this? I'm pointing this out, because this issue could affect the re-election chances for Democratic candidates as well. So if you are thinking that you can simply ignore this complaint (and request) as Ms Brady has done, I highly recommend you think again. Copies of this letter (and my 12 Sep 99 letter to MBNA's "Dispute Supervisor") are being sent EVERYWHERE! There will be quite a few "eyes" throughout America watching to see what you do about this.
Christopher C. Currie
1. My 9 Sep 99 Letter to MBNA's "Dispute Supervisor"
2. My 18 Aug 99 Letter to MBNA's "Customer Satisfaction Department"
3. My 9 Sep 99 Letter to AIG Life Insurance Company
4. My 18 Aug and 19 Aug 99 emails to Delaware Attorney General Brady's Office
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MBNA's "Dispute Supervisor" told me on the phone that when a merchant establishes a recurring pattern of changes on a person's credit card, they (MBNA America in this case) are "legally required" to continue honoring such charges (even if the account has been closed) until the account owner provides them with "proof of cancellation" such as an email request for cancellation, a notarized letter requesting cancellation, a "cancellation number" provided by the merchant, etc. How many charges it would take to constitute a "recurring pattern" is unclear. But what this means is that if a scam operator finds one of your credit card receipts in the garbage and begins making "recurring charges" on your credit card account, theoretically at least, they can continue to make such charges ad infinitum (in spite of your objections and even if you close the account), because you won't have the scam operators' address to write them a cancellation request and they aren't likely to provide you with a "cancellation number." The credit card company may provide you with the phone number the scam operator gave them, but it may be a disconnected number. Even if you do manage to contact them by phone, they may tell you that your cancellation request has been accepted and then continue to "force" monthly charges on your closed account anyway (as happened to me). MBNA, at least, appears to be happy to honor such charges despite the objections of their customers (I say "happy", because they get a "percentage of the take"). And, of course, they can always add their $29.00 "late fees" ad infinitum and threaten to ruin the customer's credit rating if the customer refuses to pay for such unauthorized charges. So if such a law does really exist, it can appropriately be called "The Scam Operators' Protection Act of 19xx."
* * *
As of 30 Sep 99, neither MBNA America nor Delaware Attorney General M. Jane Brady's office have honored my request to provide me with tangible evidence that such a law actually exists. One would think that if such a law really did exist, MBNA would be especially glad to provide me with a copy so as to "get themselves of the hook" so to speak. So why haven't they done it?
a. Is it because they can't actually find such a law now that I've called their bluff?
b. Is it because they are terrified of what the public reaction might be if the American public where to find out that such a law exists?
c. Is it because they "just don't give a damn" about the consumer rights of their customers?
* * *
Unlike my earlier articles on www.onesalt.com, I plan to add status updates to the end of this article to keep you informed regarding any progress that is made in this regard. For example,
I know that MBNA received my 12 Sep 99 letter (with two checks enclosed) on 20 Sep 99, because I sent that package via registered mail and have the return receipt. Nevertheless, when I called their "Customer Satisfaction Department" on 30 Sep 99, I discovered that they had credited my previously closed account for the $100.00 that was in that package, but after 10 days they still hadn't credited my "Platinum Plus" account for the $600.00 check that was in that was in that same package--nor had they closed that account as I had instructed them to do in writing (so I told them over the phone to close it immediately). Are they hoping to be able to add some more of their $29.00 "late fees" while they hold that check? Since the depths to which they seem to be willing to stoop in order to "screw their customers" no longer surprises me, I've initiated an inquiry to see what they may have done to my credit rating...
If anyone out there happens to know what that law is (if it exists), please tell me about it via email (email@example.com) and if possible advise me as to where I can get a copy of it. Thanks.
One grain of salt
30 October 1999
Federal Trade Commission
6th Street & Pennsylvania AVE, NW
Washington, DC 20580
Ref: My 12 Sep 99 Letter to MBNA's "Dispute Supervisor" (Atch 1)
I am hereby filing a formal complaint regarding the illegal activities of the following two companies.
1. AIG Life Insurance Company
600 King Street (P. O. Box 667)
Wilmington, DE 19899
Well over 10 years ago, in response to a direct mail ad, I enrolled in their disability insurance program and authorized them to charge the premiums to my credit card account. Since that time, that account was taken over by MBNA America (I doubt that I had an account with MBNA American at that time).
Last May, due to the unusually high interest rate MBNA was charging me on that I account, I decided to close that account. MBNA admits that they closed that account on 29 May 1999. Since AIG Life never sent me an annual statement or (as far as I can recall) ever contacted me in any other way than to make monthly charges against credit card account over the past ten years (at least), I discovered that I no longer had a valid phone number or address for them, so I couldn't cancel that disability policy. I figured that when they discovered that they could no longer make charges against that credit card account, they would send me a bill, and then I would have a valid address and phone number to use to cancel that policy.
To my surprise, I found that rather than sending me a bill, AIG Life Mass Marketing continued "forcing" those monthly charges to be made against that MBNA account even though it had been closed. And I was shocked to learn the MBNA was allowing them to do that! Although I admit that I gave AIG Life the authority to charge my credit card account for their monthly premiums in the first place, that authority ENDED when I closed that account.
Since then AIG Life Mass Marketing has made three monthly charges against that account WITHOUT my authorization (indeed in spite of my vehement objections to MBNA about allowing any further charges to be made against that account). AIG Life has sent me a refund for that last of those three charges (the one they made after they had told me on the phone that they were honoring my request to cancel that insurance policy). So the fact remains that AIG Life has in effect committed TWO COUNTS OF LARCENY against me.
2. MBNA America
PO Box 15026
Wilmington, Delaware 19886-5026
As shown in Atch 1, MBNA's Dispute Supervisor told me that MBNA was "required by law" to honor those charges by AIG Life Mass Marketing in spite of the fact that the account was closed and in spite of my vehement objections to their allowing any further changes to be made against that account. Since then I have learned from a variety of sources that there is no such "law" requiring them to honor such payments under those conditions which means that MBNA committed an act of CRIMIANL EXTORTION against me (enforced by the threat of "late fees" and implied damage to my credit rating.) Only governments have a right to force people to pay for services that they did not authorize and did not want, and MBNA is NOT a government!
Furthermore, MBNA has committed at least FOUR VIOLATIONS of the Fair Credit Billing Act in this case by:
a. Assessing interest and "late fees" on that account when the total balance due on that account was comprised entirely of unauthorized charges that were in dispute.
b. Failing to deposit a $600.00 check which I sent to them (via registered mail return receipt) to pay off the balance of another one of my MBNA accounts. They did deposit the $100.00 check that was included in the same 12 September 1999 package (Atch 1). Last week I put a stop payment on that check and have sent them another one for $620.00.
c. Failing to provide me with a refund for the overpayments that I made on at least two of those accounts within seven days (per my written request in Atch 1). It's been over a month and a half now, and they STILL haven't sent me any checks for the credit balances on those closed accounts.
d. Failing to provide me with a copy of (or at least to identify) the "law" which their Dispute Supervisor claimed "legally required" MBNA to honor those AIG charges against an account that had been closed--in spite of the fact that I had specifically requested them (in writing) to send me that information (Atch 1).
3. I realize that you people at FTC only take action against a corporation when you have received a sufficient number of consumer complaints to indicate a "pattern" of illegal or unscrupulous activity by that corporation. But from what I have seen so far, it appears to me that such illegal activities are not just an occasional practice of AIG Life Mass Marketing and MBNA America. It must be a POLICY of those two companies to engage in such illegal activities. I urge you to put a stop to such illegal practices as soon as possible.
Christopher C. Currie
1 Atch: My 12 Sep 99 letter to MBNA with its attachments.
30 Nov 99 update
Well, perhaps this will work...
30 Nov 99
Charles M. Crawley, President
P. O. Box 15019
Wilmington, DE 19886-5019
Dear Mr. Crawley,
I am writing directly to you this time, because I have found that the "Dispute Supervisor" in your so-called "Customer Satisfaction Department" has been highly dishonest towards me, both in writing and on the telephone. Attachment 1 is a copy of the letter I sent to him by registered mail on 20 Sep 99 (along with two checks for deposit in two of my MBNA accounts, as noted in that letter). Attachment 2 is a copy of the return receipt for that package. Attachment 3 is a copy of the complaint that I submitted regarding the misconduct of your company (and AIG Life, Inc.) to the Federal Trade Commission on 30 Oct 99.
For the remainder to this letter, I shall refer to my
Account AAAA BBBB CCCC DDDD as "Acct #1"
Account EEEE FFFF GGGG HHHH as "Acct #2"
Account IIII JJJJ KKKK LLLL as "Acct #3"
According to my calculations, your company owes me at least:
$ 22.29 which MBNA ILLEGALLY allowed AIG to charge in June 99 against Acct # 1 after I had closed it
$ 22.29 which MBNA ILLEGALLY allowed AIG to charge in July 99 against Acct #1 after I had closed it
$ 29.00 for the "late fee" MBNA ILLEGALLY charged Acct #1 based on a balance comprised entirely of charges that were in dispute (according to the Fair Credit Billing Act)
$ 34.90 which MBNA ILLEGALLY allowed Enforma to charge in Oct 99 against Acct #2 after I closed it
$ 29.00 "late fee" for ILLEGALLY refusing to send me a check for the "CR" balance on closed Acct #1
$ 29.00 "late fee" for ILLEGALLY refusing to send me a check for the "CR" balance on closed Acct #3
$ 16.64 for the "CR" balance on closed Acct #1
$ 5.19 for the "CR" balance on closed Acct #2
$ 21.82 for the "CR" balance on closed Acct #3
$ 10.00 to stop payment on the $600.00 check for Acct #2 which your Dispute Supervisor "misplaced" and which was included in the Attachment 1 package that I sent to him by registered mail.
$ ??.?? for all of the interest charges that MBNA added based on the unauthorized charges that your company made or allowed to be made against Acct #1 and Acct #2.
Note: I did not include the $22.29 charge that MBNA ILLEGALLY allowed AIG to make in Aug 99 after they had told me they had cancelled my insurance policy, because AIG reimbursed me for that one.
So your company owes me AT LEAST $200.13.
Your "Dispute Supervisor" told me on the phone that MBNA was "legally required" to honor those unauthorized charges by AIG Life despite my vehement objections and the fact that Acct #1 was closed. Since then, I have learned from a variety of sources that there is no such law that "requires" your company to do that, and your "Dispute Supervisor" has refused to identify what that law is (if any). Your "Dispute Supervisor" also told me on the phone that MBNA's policy in that regard only applied to vendors who had established a "recurring record" of such charges. But then MBNA allowed Enforma to make a second $34.90 charge (which I NEVER authorized Enforma to do) against my closed Acct #2 based on the fact that I had authorized them a month earlier to make just ONE charge of $34.90 against that account for a 30-day trial supply of their diet pills. So evidently, as far as MBNA is concerned, it takes only ONE unchallenged payment to a vendor to establish a "recurring record." Apparently, it is a policy of MBNA America to allow any vendor who has ever made a charge against an MBNA credit card account to make as many subsequent (unauthorized) charges against that account as they want-even if that account has been closed and despite the vehement objections of the owner of that account! And then your company uses its $29.00 "late fees" and implied threats to ruin the account owner's credit rating to extort the money to pay for those unauthorized charges.
I don't believe there is a court anywhere (even in Delaware) that will side with your company on this. So unless MBNA pays me the $200.13 plus interest that it owes me by the end of Dec 99, I will initiate legal actions against MBNA America in the Small Claims Court of the State of Rhode Island and seek as much as the Small Claims Court will allow for "punitive damages" to perhaps discourage MBNA from continuing to engage in such deplorable and illegal business practices. In the meantime, I'll continue to point out to Internet users and news agencies throughout America the fact that MBNA has been engaging in such deplorable "screw-your-customer" business practices.
Christopher C. Currie
Attach 1: My 12 Sep 99 Ltr to MBNA America's Dispute Supervisor
Attach 2: A copy of the registered mail return receipt
Attach 3. A copy of my complaint to the Federal Trade Commission
31 Dec 99 update
Evidently, Mr. Charles M. Crawley (President of MBNA America) totally ignored the above 30 Nov 99 letter that I sent to him by registered mail. Among other crimes and misdemeanors, this is the second time in two months that MBNA America violated our nations' laws by refusing to heed my written requests that they reimburse me for the amounts that I overpaid on those three accounts when I closed them out. I sent them more than what they showed was due, because (despite what they claim on the back of their bills) my experience with MBNA has been that they continue to charge their credit card accounts for the intertest accrued between the time they sent out the bill and the time the received the payment--even when the payment is for the total remaining amount due.
It also appears from my AOL Credit Alert Report dated 21 Dec 99 that MBNA falsely informed two of our nation's three leading credit rating agencies that I had a "delinquent" account with them, even though I have monthly statements from them that clearly show that those three accounts have been closed out and have "CR" balances which they are legally required to reimburse me for within 7 days after the account is closed. As I mentioned above, the depths to which MBNA America will stoop to "screw its customers" no longer surprise me.
I guess one might say that Mr. Crawley is now "thumbing his corporate nose" not only at me, but also at our nation's legal system and at the rule of law in general.
So this saga continues...
Update as of 31 January 2000:
The Federal Trade Commission wrote back to me and recommended I write to the Comptroller of the Currency regarding MBNA America's misconduct, so I decided to give our nations' criminal justice system one more opportunity to prove its worth before resorting to our nations' civil court system. So I wrote the following to them:
21 January 2000
Comptroller of the Currency
Customer Assistance Group
1301 McKinney Street, Suite 3710
Houston, TX 77010
1. I am hereby filing a formal complaint regarding the deplorable (and I'm pretty sure ILLEGAL) misconduct of MBNA America towards me over the past eight months. That misconduct has included:
a. Allowing unscrupulous vendors to make charges against my former (closed) MBNA accounts WITHOUT MY AUTHORIZATION and despite my specific written (and verbal) instructions that they were to honor NO further charges against those accounts.
b. Used "late fee" tactics and effprts to damage my credit rating to EXTORT (I believe CRIMINALLY EXTORT) money from me to pay for those UNAUTHORIZED (and I believe illegal) charges.
c. Illegally charged a "late fee" on an account whose entire balance consisted of charges that were in dispute.
d. Illegally refused (twice) to honor my specific written requests (Atch. 1 and Atch. 6) that they reimburse me for the amounts that I overpaid on my three MBNA accounts when I closed those accounts out. I overpaid on those three accounts because of their nasty little practice of charging for the interest that accrues between the time they send out their monthly statements and the time they receive the payments (even when the payment was for the entire remaining balance due). They CLAIM on the back of their monthly statements that they won't do that, but the DID do that to me when I attempted to pay off and close out the first of those three accounts last May (i.e. they LIED on their monthly statements).
e. They "lost" my $600.00 check which accompanied my 12 Sep 99 letter to them (Atch. 1, sent registered mail, and I have the return receipt). They did deposit the $100.00 check that I included for another account in that same package.
f. My AOL Credit Alert Report dated 21 Dec 99 and the enclosed report from Experian (Atch 8) show that MBNA America FALSELY REPORTED to at least one of our nation's major credit rating agencies that I had a "delinquent" account with them, based on the UNAUTHORIZED charges that they allowed to be made against the first of my accounts that I had closed. Those charges were in dispute at that time (actually they are still in dispute), so their actions in this case were in total disregard for the assurances supposedly provided to consumers in the Fair Credit Billing Act of 1975.
g. According to the Fair Credit Billing Act of 1975, MBNA America is supposed to respond within 30 days when a customer notifies them in writing that an unauthorized charge was made against one of their accounts. In my 30 Nov 99 Ltr to MBNA America (Atch 6) sent by registered mail (I have the return receipt), I pointed out that MBNA America had allowed another merchant to make an UNAUTHORIZED charge against another one of my MBNA credit card accounts that had been CLOSED, and I asked them to reimburse me for that unauthorized charge. But now (50 days later) it is become apparent that MBNA has totally ignored that letter.
2. I initially reported these misdeeds to the Attorney General of Delaware who totally ignored me. Evidently, the reputation that Delaware has for being "super-friendly to corporate interests" is well deserved. Then I reported them to Attorney General Janet Reno's Office and received a response from them referring me to the Fair Trade Commission, which in turn referred me to you. The attached documents pretty well describe the whole situation. According to the Fair Credit Billing Act (FCBA), "Any creditor who fails to follow the FCBA dispute settlement procedures my not collect the amount in dispute, or any finance charges on it, up to $50.00, even if the bill turns out to be correct." Who is supposed to enforce that? YOU? As I have shown, MBNA has not only violated the FCBA procedures in multiple ways, they have in effect "thumbed their corporate nose" at the FCBA and at the entire American system of justice!
4. I hereby formally request that CRIMINAL CHARGES be brought against MBNA America that will lead to monetary FINES that are large enough to EFFECTIVELY discourage MBNA America (or any other American credit card agency) from ever again:
a. Allowing charges to be made against a credit card account that has been closed by the consumer.
b. Refusing to pay consumers for the "CR" balances that remain as a result of overpayments made on credit card accounts that have been closed.
c. Attempting to damage the credit rating of consumers based on charges that are in dispute.
d. Totally ignoring written consumer complaints regarding unauthorized charges were made on their accounts.
5. Your help to get MBNA to reimburse me for those overpayments and for the UNAUTHORIZED and ILLEGAL charges that they allowed or made on those three accounts will also be appreciated.
Christopher C. Currie
1. My 26 Sep 99 letter to MBNA's "Dispute Supervisor"
2. The 4 Nov 99 response from the U. S. Department of Justice to my complaint referring me to the Federal Trade Commission.
3. My 30 Oct 99 letter to the Federal Trade Commission
4. A 12 Nov 99 letter from the Federal Trade Commission referring me elsewhere.
5. A 13 Dec 99 letter from the Federal Trade Commission referring me to some further elsewheres.
6. My 30 Nov 99 letter to Charles M. Crawley, President of MBNA America.
7. The latest statements I have received for my three former MBNA America accounts which show that MBNA America is continuing to refuse to honor my instructions to send me checks for the amounts I overpaid when I closed those accounts.
8. Evidence that MBNA America dishonestly, illegally, and willfully attempted to damage my credit rating based on the UNAUTHORIZED charges that they allowed to be made on the against the first account that I had closed.
On 24 January 2000, I received a refund check from MBNA American for the overpayment I made on my U.S. Air Force Academy AGG account with them (four months after I had paid off and closed that account out). The still owe me refunds for the overpayments I made when I closed out the other two accounts.
I also received confirmation from Experian (one of our nations' three major personal credit rating agencies) that MBNA went out of its way to degrade my credit rating by filing a "delinquent account" notice about me last September, even though their own statement shows that I made a $10.00 payment toward the $41.31 balance on that account on 23 Aug 99. According to the Fair Credit Billing Act of 1975, I wasn't legally required to pay anything on that account at that time, because the entire balance due on that account was comprised of unauthorized charges that were in dispute at that time (charges that MBNA allowed to be made against that account AFTER I had completely paid off and closed out that account). According to the Fair Credit Billing Act, "While is bill is being disputed, the creditor may not threaten to damage your credit rating or report you as delinquent to anyone." So I regard MBNA America's efforts to damage my credit rating under these circumstances to be not only unethical, but downright DISHONEST and ILLEGAL!
Since last September, I have applied for three new credit card accounts to replace the three MBNA accounts that I closed out. Two out of three of those applications were rejected based on MBNA America's efforts to falsely defame my credit reputation. Then one of the credit card companies that I already had (Fleet) wrote and told me that they were reducing my credit limit from $9,500 to $5,400, based on MBNA America's false report about me (Who told Fleet to run a check on my credit rating?). So within a week, I used the new credit account that I did get to pay off and close out my Fleet account. Each month, I receive four our five so-called "pre-approved" credit card offers in the mail, so there's no reason why I should put up with such shoddy treatment on the part of any credit card company. I'm confident that if I keep applying, I can get some more credit card companies to accept my application (not all credit card companies have such "empty headed" underwriters or no underwriters at all). But that's not what really worries me about this situation....
What worries me is that large corporations like MBNA America seem to have adopted the attitude that they can "thumb their coproate nose" an our nation's legal system and treat American citizens as if we were citizens of some third world country! I intend to prove them wrong about that.
"one grain of salt"
Update as of 29 Feb 2000.
On 28 Feb 2000, I received an MBNA check for the second of the three account closeout overpayments that I asked them (in writing) to reimbursement for last September.
I tried to get one of our nation's credit credit rating agencies (Equifax) to withdraw MNNA's "delinquent account" report, since it was submitted in violation of the Fair Credit Billing Act of 1975. They refused, insisting that they had to retain that illegal report in my records for seven years. They did allow me to add a comment of my own regarding that report, "MBNA's report violates the FCBA; it is based solely on unauthorized charges that were/are in dispute."
Although I feel confident that I could get my money back from MBNA if I hired a lawyer to persue the litigation procedures authorized in the Fair Credit Billing Act of 1975, or if I took this matter to Rhode Island's Small Claims Court, I have decided instead to do what I can to put a STOP to MBNA's practice of allowing merchants to "force" charges against credit card accounts that have been paid off and closed by the consumer. So far, at least, our national criminal justice system has failed utterly to do anything about these apparently criminal practices, so for $250.00 (which is more that what MBNA owes me), I have retained a lawyer who specializes in consumer protection issues and related class-action lawsuits. I have asked him to determine precisely which laws have been violated by MBNA America in this case, to identify the punishments that are prescribed by those laws, and to assess the feasibility of launching a class action lawsuit against MBNA America and any other American credit card company that engages in that practice.
I'll keep you posted on the progress of all this.
Update as of 31 Mar 2000
Not much to report this time. My lawyer is researching the laws that MBNA has violated, and I just received a response from the Comptroller of the Currency confirming that they had opened a case (#154640) in response to my complaints regarding MBNA's misconduct.
Update as of 30 Apr 2000
MBNA America has finally sent me a check for the overpayment I made last fall when I closed out the third of my three MBNA accounts. They also appear to be "back-peddling" a bit in that they sent me check to reimburse me for the $29.00 "late fee" they charged last September and for the interest accrued while I was mailing in my check to pay off the full balance due on that first account.
However, they still staunchly claim that they have a right to allow merchants to make charges to MBNA accounts after they have been closed. According to their 24 April 2000 letter to me, "When a Customer requests regular monthly fees to be charged to a credit card account for items such as insurance, the merchant will typically set up an automated billing process. Charges are submitted each month until you contact the merchant. Unfortunately, we are unable to intervene until the merchant is contacted to cancel." So if a merchant (or a scam operator) submits a request to MBNA to allow "automated billing", MBNA will oblige and allow that merchant or scam operator to continue billing the account for as long as they wish to or until the customer receives some kind of confirmation from the merchant or scam operator that their "service" has been cancelled.
In fact, as far as I and my lawyer have been able to determine to date, there is no law that allows MBNA to do that on an account that has been closed, and there was nothing in the MBNA "Credit Card Agreement(s)" that authorized them to do that either. Furthermore, there was nothing in my contract with AIG Life Insurance that allowed them to do that. According to my lawyer, forcing a person to pay electronically (as opposed to sending the merchant a check) is prohibited by the Electronic Funds Transfer Act. So it still appears to me (at least) that MBNA was NO LONGER AUTHORIZED to "pay merchants for me" after I closed those accounts, especially in light of the fact that I told them in no uncertain terms that they were NOT to allow any further charges to be made against those accounts. And if that is true, then their efforts to collect for those unauthorized charges constituted criminal acts of extortion.
It is a common practice these days for merchants (including TIME/LIFE, Enforma System, etc.) to request credit card companies to set up such "automated billing" arragements even when the customer thought at the time of the purchase that he (or she) was simply ordering a one-time purchase (such as a 3-CD set of hit songs of the '60s). Then, by the time the customer realizes that in fact he had gotten himself into a "subscription" for recurring (usually monthly) purchases and therefore calls the merchant to cancel that subscription, the merchant has succeeded in "selling" (and charging) the customer for one or more month's worth of products and services than the customer had actually ordered. A true scam operator could simply continue making such charges anyway, and MBNA would allow them to do so, even after the account has been closed.
So this apparently illegal practice is ALREADY being widely abused throughout America!
Update as of 26 May 2000
The saga continues: The following are the responses I got from a Vice President of MBNA America and from the Comptroller of the Currency--along with my replies to each. It SHOULD require at least an act of Congress or preferably a Constitutional Ammendment to take away a fundamental right from all US citizens, but as you can see, it's in the process of happening anyway--simply by bureaucratic decree--unless we can put a stop to it. What's at stake is your right to be free from being forced by private corporations to pay for goods or services that you did not specifically authorize.
MBNA Bank, N. A.
Wilmington, Delaware 19884
April 24, 2000
XXXXXX, XX XXXXX
Re: Accounts AAAA BBBB CCCC DDDD
EEEE FFFF GGGG HHHH
Dear Mr. Currie,
We recently received your correspondence dated January 21, 2000, addressed to the Customer Assistance Group of the Office of the Comptroller of the Currency. This correspondence referenced a charge from AIG Life Mass Marketing for $22.29 that posted on your July 1999, August 1999, and September 1999 billing statements. This letter is to confirm your conversation with Kristin McLaughlin, of my office, on April 6, 2000.
MBNA America is committed to providing Customers with a superior level of service on every inquiry. We strive to resolve each inquiry to our Customers' satisfaction. We apologize that we did not provide a response to your correspondence received in December 1999.
Closing an account does not guarantee that a preauthorized charge will automatically be cancelled with the merchant. A closed status on a credit card account means that electronic authorization to reserve availability on a credit card account will be declined. Whether a merchant is required to obtain an authorization varies depending on the type of merchant, the dollar amount of the sale, and the restrictions imposed by Visa. When a Customer requests regular monthly fees to be charged to a credit card account for items such as insurance, the merchant will typically set up an automated billing process. Charges are submitted each month until you contact the merchant. Unfortunately, we are unable to intervene until the merchant is contacted to cancel.
According to the Fair Credit Billing Act, it is our responsibility to respond to your initial dispute within thirty days or receiving written notification. We responded to your initial inquiry and requested the date you cancelled your membership. Unfortunately, because this information was not provided, we were unable to issue credit to your account. On August 6, 1999, MBNA sent you a letter advising that we could not issue a credit for those charges because you did not cancel with the AIG Life Mass Marketing. Our letter also provided the address and phone number to contact the merchant directly. Subsequently, the minimum payment due was not received and the account received a late fee, interest charges, and went delinquent.
As discussed with Ms. McLaughlin, we have removed the $29.00 late fee and interest charges totaling $7.49. These credits will appear on your May 2000 statement and a credit balance refund in the amount of $36.49 will be send to you. We have also removed the delinquency associated with this dispute and your credit report will be updated.
Your letter also addressed a payment of $600.00 that did not post to your account. A letter was sent to you on October 20, 1999, indicating that we needed a copy of the front and back of your cashed check to assist you with this inquiry. At this time, we have not received a copy of this check. Your accounts are both closed with zero balances.
Mr. Currie, we sincerely regret any inconvenience this matter may have caused you. If you have any additional questions, please contact me at (800)-441-7048, extension 78291, or Kristin McLaughlin, at extension 32665.
C: Office of the Comptroller of the Currency
2 May 2000
Andrew Reilly, Vice President
MBNA America, N. A.
Wilmington, DE 19884
Ref: Your 24 Apr 2000 Ltr to me regarding Office of the Comptroller of the Currency Case #154640
Dear Mr. Reilly,
Thank you for your 24 Apr 2000 Ltr, your company's refund for that $29.00 late fee and $7.49 in interest charges and the discontinuance of your company's "delinquent account" reports to our nation's credit rating agencies. I have received and cashed that check.
However, none of those charges would have occurred in the first place if your company had been obeying the law and the terms of your own published credit card agreements. There was nothing in your company's Credit Card Agreements for the two accounts in question that said anything to the effect that "When you close your account with us, we will continue to allow merchants to make charges against that account as long as they wish to or until you provide us with a cancellation number provided by that merchant." Likewise, my disability insurance contract with AIG Life specially says, "An Insured Member's coverage will end on the first of the end of the grace period, if premium is not paid." There is nothing in that contract that REQUIRED me to pay their premiums by means of a credit card rather than periodically sending them a check. When I attempted to exercise that written option for ending my contract with AIG, your company REFUSED to allow me to do it and instead allowed them to continue charging premiums from me for three months after the account was closed (AIG subsequently reimbursed me for the third of those three charges).
As far as I (and my lawyer) have been able to determine, and despite your "Dispute Supervisor's" claims, there IS NO LAW that allows your company to do that. Furthermore, I have asked your company repeatedly (verbally as well as in writing) to identify what law allows you to do that, and evidently your company can't find one either. As I thought I made clear in my 12 Sep 99 Ltr to your "Dispute Supervisor" (Atch 1), once I closed those accounts, your company was NO LONGER AUTHORIZED
to "pay merchants for more me" or to serve as my agent or representative in any way in "the credit world." In the absence of any law or contractual agreement that authorizes your company to accept charges against a credit card account that has been closed by the consumer, it appears to me that your company was engaging in criminal acts of extortion when you attempted to collect for those UNAUTHORIZED charges.
My complaint to the Comptroller of the Currency regarding your company's failure to respond to a disputed charge within 30 days of receiving written notification is in reference to my 30 Nov 99 Ltr to MBNA America (Atch 2). This concerned my MBNA account XXXX XXXX XXXX XXXX where I authorized what I thought was going to be a one-time charge of $119.75 (25 Aug 99) to "Enforma Natural Products." Then, despite my 12 Sep 99 Ltr telling your company in no uncertain terms that NO further charges where to be allowed against that account and over a month after your company confirmed that the account had been closed, your company nevertheless allowed them (using the name "Burn it off & Keep it Off") to make a $34.90 charge against that account and proceeded to extort payment from me for that unauthorized charge. By then, technically, I was no longer a "customer" of MBNA America! In fairness to Enforma, when I received their unexpected shipment of more diet pills, I immediately called them to cancel the "subscription" that I didn't realize I had gotten myself into, but I told them I would pay for that package I had just received if they would send me a bill for it (I did NOT authorize them to make a second charge against that account which by then had been closed for over a month). As you can see, your company's practice of allowing merchants to continue making charges against an account that has been closed can be easily abused (by legitimate companies as well as scam operators).
Finally, after explaining your company's practice of allowing merchants to request to use your "automatic billing process", you said in your 24 Apr 2000 Ltr, "Unfortunately, we are unable to intervene until the merchant is contacted to cancel." I don't believe that statement is true. To begin with, it doesn't take a computer genius to recognized that you could simply add some code to your computer system that says in effect, "If the account is closed, terminate all of its automatic billing processes." Furthermore, I strongly suspect that your company already has a computerized option for doing that when you learn that a customer has become deceased. Dead people can hardly be expected to cancel their contracts with merchants, and your threats to damage their credit rating aren't likely to have much an effect.
So I am asking the Comptroller of the Currency to put an end (permanently) to the practice of allowing merchants to make (any kind of) charges against credit card accounts that have been closed by the consumer. Only governments should be allowed to have the power to force people to pay for products or services that they did not authorize, and your company has crossed that line!
CHRISTOPHER C. CURRIE
1. My 12 Sep 99 Ltr to MBNA's "Dispute Supervisor"
2. My 30 Nov 99 Ltr to MBNA
copy to: The Comptroller of the Currency
Comptroller of the Currency
Administrator of National Banks
Customer Assistance Group, 1301 McKinney Street, Suite 3710, Houston, Texas 77010
Pone (800) 613-6743, FAX: (713)-336-4301
May 8, 2000
Christopher C. Currie
XXXX, XX XXX
Re: Case #154640
MBNA AMERICA BANK, NATIONAL ASSOCIATION
Dear Mr. Currie
The Office of the Comptroller of the Currency (OCC) is responding to your complaint against the above subject bank, and offers the following information regarding our decision. As a result of your complaint, we contacted the bank on your behalf. We reviewed your information and that of the bank.
The bank has furnished a copy of their April 24, 2000 letter to you. The bank correctly explains that closing your account does not guarantee that a pre-authorized charge will automatically be cancelled with the merchant. The agreement you made to charge your account was between you and AIG Life Insurance Company. The bank cannot cancel your agreement with a merchant.
Any charges posted to your account before you cancel the authorization with the merchant are not unauthorized charges to your credit card account. As you indicate in your correspondence this authorization has been in place for several years and had not been cancelled by you at the time you closed the credit card account. According to the Policyowner Service Request Form you provided, you signed the request to cancel the policy on September 8, 1999.
You question the late charge to your September 1999 Statement saying you made a payment of $10.00 on 8/23/99 for payment due 09.02/99. However, the minimum payment due was $35.00. Banks normally charge a late fee whenever the minimum payment due is not received. In this case the payment was $25.00 short of the minimum amount due.
In addressing the payment of $600.00 that did not post to your account, the bank indicates they sent you a letter on October 20, 1999, indicating that they needed a copy of the front and back of the cashed check so they may research what happened to the payment. They indicate that as of their April 24, 2000, letter they have not received the copies so they could locate this payment for you. They do indicate that they have removed the $29.00 late fee and interest charges totaling $7.49. You should be receiving a refund check of $36.49 for the credit balance on the account.
The Office of the Comptroller of the Currency (OCC) examines national banks to assure their safe and sound financial condition and to ensure their compliance with federal banking laws, rules, and regulations. The OCC's consumer complaint process was established to ensure that bank customers' legal rights are protected. However, many transactions that lead customers to complain about a bank's actions are not covered by federal laws and regulations within the OCC's jurisdiction. In those cases, this Office has no authority to direct banks to take corrective actions or satisfy the requests of consumers.
You can obtain a free copy of Regulation Z (12 CFR 226) from the nearest Federal Reserve Bank. Section 226.13 specifically covers billing error resolution.
If you do not agree with or understand the bank's response, we can only suggest you consult with an attorney on what other legal remedies you may have.
Customer Assistance Specialist
15 May 2000
Lorraine Endicott, Customer Assistance Specialist
Comptroller of the Currency
Customer Assistance Group
1301 McKinney Street, Suite 3710
Houston, TX 77010
Ref: Your Ltr dated 8 May 2000 concerning Case #15460
Dear Ms. Endicott,
I was quite surprised to see that you people have agreed with MBNA's position regarding what "closed" means when a customer instructs a credit card company to close an account and to not allow any further charges to be made against that account, because it still appears to me that there is no American law or contractual agreement involved in this case that can be cited to support your (and MBNA's) position.
To begin with, you were evidently misinformed by AIG and/or MBNA regarding the nature of the contract for my AIG disability insurance policy. I was finally able to find my original copy of that contract and have enclosed a copy (Atch 1). Notice that this contract, which I signed in the fall of 1986 (when I authorized AIG Life to begin charging its premiums to my credit card account) does NOT contain any clause that authorizes AIG Life to unilaterally alter that terms of the contract. It wasn't until years later that such "unilateral contract change" clauses became a common feature in financial contracts of this nature (especially in credit card agreements). Notice also that there is nothing in that contract the REQUIRES me to pay the premiums using a credit card (rather than sending them a check); nor is there anything in that contract that requires me to send AIG Life a "Policyowner Service Request Form" in order to terminate that contract. To the contrary, the signed addendum to the contract clearly describes the conditions/options for terminating that contract, and option 3) is that the contract would be terminated at "the end of the gace period, if premium is not paid." When I attempted to exercise that option, AIG Life REFUSED to allow me to do it, and MNBA supported their efforts to violate that contract. So it was AIG Life, not me, who violated the terms of that contract, and your reference to date on the "Policyowner Service Request Form" that I received for the first time last September, signed, and returned to AIG is irrelevant in this case.
Now regarding your two statements:
a) "The agreement you made to charge your account was between you and AIG Life Insurance Company." That's right! But MBNA America has illegitimately assumed the governmental role of "contract enforcer" and exercised government-like powers to force US citizens (me, for example) to pay for goods and services that they did NOT specifically authorize. Such roles and powers as SUPPOSED to be exercised only by governmental agencies using laws, courts, and law enforcement agencies that are subject to democratic checks and balances. The legitimate role of a credit card agency, on the other hand, is essentially to pay merchants on behalf of their customers (clients) when (and only when) their customers provide the appropriate authorization for such payments to be made. [The money that pays the salaries of credit card agency employees comes from their customers, NOT from the merchants that MBNA America apparently prefers to serve.] Those customers have as much a right to revoke the authority to make charges against their credit card accounts as they do to grant such authority in the first place. Credit card companies like MBNA America have no business getting involved in issues regarding the legality of contracts negotiated between their customers and merchants. In my case they did, and they WRONGFULLY ruled in favor of the merchant (AIG Life). This effort by MBNA America to assume governmental roles and exercise government-like powers is like the proverbial "camel sticking his nose into the owner's tent." If they are allowed to get away with that kind of conduct, in a matter of years our government could end up in as big a legal mess as the present government of Russia!
b) "The bank cannot cancel your agreement with a merchant." FALSE! First of all, it was ME who was cancelling that agreement, not the bank. Secondly, the bank most certainly CAN honor their customer's request that no further charges be allowed against the account that the customer has closed. Furthermore, as far as I have been able to determine at this point, it appears that credit card agencies are legally REQUIRED to honor such customer instructions. I have repeatedly requested MBNA America to send me a copy of the paragraph(s) in the laws(s) that authorize them to allow merchants to continue making charges against an account that has been closed by the consumer (even when that consumer has instructed them in writing as well as verbally that the bank was NOT to allow any further charges to be made against that account). Judging for their lack of response to these requests (which, I blieve, is itself a violation of the Fair Credit Billing Act of 1975), it appears to me that they can't find such a law. Can you?
I hereby formally request that your office send me a copy of the paragraph(s) in the laws(s) that authorize credit card companies to allow merchants to continue making charges against an account that has been closed by the consumer (even when that consumer has instructed the bank in writing as well as verbally that they were NOT to allow any further charges to be made against that account).
If you can't find such a law, then I request that your office revise it's decision in this case (especially in light of the misinformation regarding that contract that you received from MBNA and/or AIG Life) and initiate legal actions against MBNA America (i.e. for engaging in criminal acts of extortion).
I also request that you take whatever steps are necessary to PERMANENTLY end the practice to allowing merchants to continue making charges against a credit card account that has been closed by the customer.
Christopher C. Currie
1 Atch: a copy of my contract with AIG Life for disability insurance.
Update as of 30 June 2000
The following two letters that I received in June "took the wind out of my sails" to some extent, but I'm still pondering as to what to do next (if anything).
1. The first letter is a somewhat conciliatory response to my 2 May 2000 letter to Andrew Reilly, a Vice President of MBNA America. He basically re-states his company's position on the issue of allowing merchants to continue making charges against an account that was closed by the consumer. However, he admits (in effect) that their position is based on "regulations and procedures" rather than on a "federal law" as their Dispute Supervisor had previously claimed. Judging from the lack of response to my "show me the law" challenge, it appears that the Office of the Comptroller of the Currency was unable to find any law that authorized MBNA to do that either.
2. The second letter describes the results of some research and analysis that I paid a lawyer to perform regarding this issue. He was also unable to find any law that authorized MBNA to do that other than a "common law" principle that implies that third parties are entitled to rely on the authority granted to an agent until THEY are given notice that it has been withdrawn. Common law is a "body of law" that has evolved over time based on an accumulation of judicial decisions rather than legislative action.
So, if it becomes a "common practice" for corporations to successfully get away with forcing consumers to pay for products or services that they did not authorize, then US citizens will have lost one of their most fundamental rights as a consumer. Furthermore, I find the practice of allowing private corporations to assume governmental roles (like contract adjudication and enforcement in this case) to be somewhat disturbing. What if our government decided to "contract out" the rest of its judiciary functions? Would such a contract go to the lowest bidder or the highest bidder? How much would Bill Gates be willing to pay to get a contract to run our nation's civil justice system? This whole situation needs to be monitored, but other than taking this case to a small claims court (which would hardly be worth the effort), I'm not sure what else I can do about it. Anyhow, here are those two letters:
Jun 20, 2000
Christopher C. Currie
Re: Accounts: AAAA BBBB CCCC DDDD
EEEE FFFF GGGG HHHH
Dear Mr. Currie
I received your letter regarding the above referenced accounts with MBNA America. First, let me apologize for any inconvenience this matter may have caused you and assure you that we strive to satisfy each Customer on an individual basis.
Account numbers AAAA BBBB CCCC DDDD and EEEE FFFF GGGG HHHH were in fact closed on May 29, 1999 and September 30, 1999, respectively. The charges you questioned were from merchants whom you had previously authorized to charge your accounts. The regulations and procedures under which we operate require cardholders to cancel existing memberships that were previously authorized directly with the merchant. Nonetheless, I understand your concern with these types of charges posting to your closed account. Should a merchant fail to cancel the recurring charges and we have received a copy of your cancellation notice in our office, you do not have to continue to send us a copy of your cancellation notice each time the charge appears. In your case, your previous correspondence to us adequately explains the situation, and the reason you did not cancel with the merchant and we will keep this on file.
Mr. Currie, if you should have any additional questions, please contact me at (999) 999-9999, extension 9999.
To: Christopher Currie
From: X. XXXXXX XXXXXXXX
1. Scope. In response to the materials you provided concerning your former MBNA account, I have reviewed applicable consumer laws, FTC staff letters, and OCC official commentary, as well as relevant case law.
2. Violations. I believe that MBNA potentially violated the Fair Credit Billing Act. However, it is my opinion that damages are small, if any.
3. Analysis. The questions here turn not only on consumer protection statutes, but on common law principles of agency. When you open a charge account, you are appointing the issuer as your agent to process charges, which you then agree to make reimbursement for as set out in the cardmember agreement. When you arrange a periodic charge, you are authorizing the issuer, as your agent, to apply said charges. Under principles of agency, you have the right to withdraw any powers given to your agent at any time. Thus, you have the right to order the issuer to stop processing periodic charges.
4. However, that is only the first step in the process. Also under agency principles, once you have vested an agent with authority, third parties are entitled to rely on that authority until THEY are given notice that it has been withdrawn. That complicates your attempt to cease periodic payment via your credit card, at least until notice was given to the insurer.
5. This is further complicated by the Electronic Funds Transfer Act, which prohibits requiring that payments be made electronically. Absent agency principles, this would give you some refuge (and leverage) against MBNA. I am of the opinion that MBNA's insistence that the insurer be notified would not be viewed as "requiring" electronic payment. However, their correspondence indicates that they did not simply ask you to notify the insurer -- they required you to cancel coverage. This took them beyond their role as your agent, and gives you a credible argument that they violated EFTA. If you wished to have coverage, you had the right to pay by any means you wished. It was not MBNA's province to interfere with this.
6. Based on this, I do believe that the charge was properly disputed, and, if not removed, would lend to liability under the FCBA. If full restitution has been made, however, you have no damages at this point (of course, frustration and waste of time are damages). The same would be true of any Consumer Protection Act suit.
7. This might also lead to liability under a contract theory for breach of the implied duty of good faith and fair dealing, which is implied in every contract. Also, there is a remote possibility of antitrust violations, but these are so remote that I did not even develop them.
8. Class action feasibility. I have discussed this case with several firms, including one I work with that is involved in Providian litigation. All agreed that the case would probably not make a good class action, as the issues appear to be too individualized. Essentially, it would be difficult to find others who attempted to cancel periodic charges and were put through the hassle to which you were subjected. Based on this, if you wished to pursue any action, I would recommend doing it at the lowest level possible (small claims or district court) as a purely individual action.
An Aug 2000 upate
The following letter shows how I decided to deal with another company that tried to "screw" me during my MBNA saga. Unlike the MBNA case, what First Card attempted to do appears to have been perfectly legal, becuase their credit card agreement stipulates that they have a unlateral right to jack up their interest rates as high as they want. If you have such a credit card account, I recommend you get rid of it, or at least ensure that you are financially able to pay it off and close it out "at a mement's notice." That in itself is probably a good reason to get some additional credit card accounts (preferably with companies that offer fixed interest rates or interest rates that are fixed at a specified percentage over the prime interest rate). As you can see from the examples above, our nation's legal system doesn't offer very much protection from such abuses by credit card companies, so your most reliable protection is to be able to ditch one or more of you credit card accounts at a mement's notice. If more customers did this (and made their reasons for doing this known to various cosumer protection web sites), credit card companies like MBNA, Fleet, First Card/First USA would be forced to discontinue such unscrupulous practices if they wished to stay in business (a business which, by the way, has thousands of players and is therefore VERY competitive).
9 August 2000
P.O. Box 15153
Wilmington, DE 19886-5153
Last April I noticed you had jacked the interest rate on my First Card account #AAAA-BBBB-CCCC-DDDD from about 13.5% to 23.99%, so I immediately paid off the entire balance (about $5,000). However, since it was one of two credit cards that I had been using for many years, I continued to use it to make over $3,000 worth of purchases since then, but I paid the balance in full each month. So in spite of your obscene 23.99% interest rate (or more precisely BECAUSE of it), your company has earned virtually NO interest from me during the past four months! While doing so, I was hoping that you company might be smart enough to recognize the foolishness of your ways in this regard. Evidently, you're not.
On 13 July, I called your customer service phone number and they forwarded my call to your "APR" representative. I asked her why you had jacked my interest rate up so high, so she did some research and found a letter that she said was sent to me in January. I never saw that letter, because if I had, I would have paid off and closed out that account back then (and you would have lost your "percentage of the take" on over $3,000 worth of purchases). When she read the reasons why you decided to jack up my interest rate, her words sounded like they were coming out of the mouth of the "Mad Hatter" in an Alice in Wonderland tale. To add insult to injury, she mentioned that one of those absurd reasons was because I had changed my address within the past year. So the fact that I had enough confidence in my financial future to purchase a house and move from an apartment into that house somehow made me "less credit worthy" in your opinion. If Lewis Carroll were alive today, such reasoning would probably inspire him to write a whole new book?
It appears that you people must have laid off all of your underwriters and are now relying on some computer programmers who work for a credit rating agency to run (and ruin) your business! Take a look at that letter and see if ANY of those reasons you cited for jacking up my interest rate made any sense whatsoever when you consider that my income is over $100,000/year, I own my own home, and have a hefty 401K account that I can borrow from whenever I need to.
Furthermore, who asked YOU to perform an inquiry on my credit rating (an act which itself tends to degrade a person's credit rating according to the logically flawed and factually inaccurate "paranoid point systems" devised by some those computer programmers)? It appears that your company periodically performs such inquiries on your customer's credit ratings, and whenever you discover that a customer's available credit has become temporarily thin (due to a large purchase, or as in my case, because I paid off and closed out a couple of my credit card accounts), your company has made it a policy to "help them out" by jacking their interest rate up to an obscene 23.99%. If you think that the rest of your customers that you have "financially raped" like this are any less angry at you than I am, you should think again.
When I asked your "APR" representative to lower my interest rate to a reasonable level, she told me, "We can't do that", which in my opinion is "excrement de taurus" (if you'll pardon my French). Your co-workers who manage my First USA e-card account #EEEE-FFFF-GGGG-HHHH (and who, judging from the fact that they you share the same address with them, probably work just down the hall from you) are only charging me an interest rate of 9.99%,--and they keep sending me new checks to encourage me to borrow even more at that rate! So I politely told your "APR" representative that in effect I would never use my First Card again. She didn't care.
So I hereby formally request:
1. That you close my account #AAAA-BBBB-CCCC-DDDD. Under no circumstances are you to allow any further charges to be made against that account. Enclose is a $500.00 check to pay off the remaining balance plus an American On-Line charge which may have been made since your last statement. Please reimburse me for the amount of overpayment within 10 days (as required by law).
2. That you close my account #EEEE-FFFF-GGGG-HHHH. Under no circumstances are you to allow any further charges to be made against this account either. Enclosed is a $7,600.00 check to fully pay off the balance on that account (including any interest that has accrued on that account since you last statement). Please reimburse me for the amount of overpayment within 10 days (as required by law). Your managers of this account have treated me quite decently, but in light of your efforts to "financially rape" me, I no longer want to do business with your company in any way, shape, or form.
Christopher C. Currie (now a FORMER double-account First USA "cash cow")
XXXX XXXXXX XXXX
YYYYYYY YYYY YYYYY
PS: I'm sending a copy of this letter to various web sites and news agencies that are concerned with such matters, because I believe your customers (and potential customers) should know now First USA REALLY treats its customers (even customers who have been a "cash cow" for you company for many years).
"Credit card companies who SCREW their customers tend to LOSE their customers--FOREVER!"
Also, on 30 August I discovered that Harris Bank VISA Card (now a subsidiary of Wachovia) has a very nasty policy of rejecting charges made with their credit card if (for any reason whatsovever) a payment fails to arrive by their specified due date. Most credit card companies simply charge a $25.00 "late fee" but allow the customer to continue making charges on the card. In far as I'm concerned, that nasty practice by Harris Bank/Wachovia makes their credit cards more of a liability than an asset, so I closed my account immediately.
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Last modified on Friday, May 03, 2002