LowCards.com Weekly Credit Card Update–September 2, 2016
Pentagon Credit Cards Still Being Used at Strip Joints
A year after finding that military personnel were using government credit cards at places such as Larry Flynt’s Hustler Club, the Pentagon’s inspector general said this week that safeguards still haven’t been put in place to protect taxpayer dollars from being used for unauthorized expenses. The IG office found last year that from July 2013 to June 2014, Pentagon personnel spent an unauthorized $952,258 at casinos. They dropped another $96,576 at places like Sapphire Gentleman’s Club, which advertises itself as the world’s largest strip club, “featuring 70,000 square feet of topless entertainment.” At the time, the IG warned that beyond the abuse of taxpayer dollars, the use of the travel credit cards for personal expenses in gambling houses and strip bars created potential national security vulnerabilities–blackmail is a risk if military personnel take part in sexual impropriety or incur major debt. Story by Nicole Gaouette for CNN.
For Credit Cards, 1.5 Percent Cash Back is the New Standard
Credit cards with 1.5 percent cash-back rewards rates are going from novel to normal. Today, consumers can get no-annual-fee cards that offer 1.5 percent cash back on every purchase from several major issuers—including Capital One, Barclaycard, Chase, Wells Fargo and U.S. Bank. Citi offers an even higher rate: 1 percent on every dollar you spend and another 1 percent on every dollar you pay off. If you avoid interest charges, these cards can earn you hundreds of dollars per year in rewards without requiring any extra spending. They also signal a big change in the credit card industry. Story by Claire Tsosie for US News.
Prepaid Card Gets First New Features After Glitch
Nearly a year after a technical glitch prevented its customers from getting access to their money, prepaid debit-card provider RushCard is rolling out new features that usually aren’t available to low-income consumers. RushCard, which was founded more than a decade ago by hip-hop producer and entrepreneur Russell Simmons, will introduce a revamped mobile-phone application that lets customers temporarily put their accounts on hold if they misplace their cards. The revamp will also give customers the option to open the app by authenticating it with a fingerprint for additional security. The moves represent the first new features from the company since last fall’s problems. In May, RushCard agreed to pay $19 million to settle a lawsuit filed by consumers who were frozen out of their accounts last fall. The situation, which occurred when the company changed its card-processing platform, turned into a publicity debacle for RushCard as cardholders who couldn’t pay their bills blasted the company on social media. Story by Robin Sidel for The Wall Street Journal.
Mobile Banking Vaults to Second Place in Consumer Preference
Mobile banking has leaped into position as the second-most-preferred form of banking, chosen by 18 percent of bank customers, up six points from last year and nearly double since 2014, according to a new survey. Online banking also rose as the most preferred banking method, however, with 55 percent of respondents saying they prefer to bank online–marking the eighth consecutive year that consumers have named the Internet as the most popular way to bank. The survey found that the number of people who preferred visiting a branch continued falling, dipping three points to 14 percent. ATMs were preferred by 6 percent, down seven points from 2015. Four percent chose phone banking, and 3 percent said they preferred to bank by mail. Story for the ABA Banking Journal.
Russian Hacker Convicted of Stealing 1.7 Million Credit Card Numbers
A Russian hacker has been convicted for stealing 1.7 million credit card numbers and selling them on the black market. Roman Seleznev, who operated as Track2, was convicted in the Western District Court of Washington on 38 counts, including wire fraud, intentional damage to a protected computer, obtaining information from a protected computer, possessing 15 or more unauthorized devices and aggravated identity theft. The operation, which lasted from 2009 to 2013, mainly involved hacking point-of-sale computers and installing malware to steal credit and debit card information. Most of the businesses he attacked were in Western Washington, and the Broadway Grill was forced into bankruptcy due to his alleged actions. In total, the attacks resulted in losses of more than $169 million for 3,700 financial institutions. Since Seleznev’s father, Valery Seleznev, is a member of the Russian Federal Assembly and close to President Vladimir Putin, the case has caused some international tension. Story by John Oldshue for LowCards.com.
The Ever-Rising Cost Of Fraud
Fraud can be very costly. According to the Association of Certified Fraud Examiners, the money lost by businesses to fraudsters amounts to over $3.5 trillion each year. The cost of fraud is only accelerating; it’s getting more expensive, it’s happening more often and the number of account takeovers is rising dramatically. The Q3 Global Fraud Attack Index data indicates that instances of fraud are on the rise, growing by 126 percent in the last year. Fraud attacks more than doubled between Q2 2015 and Q1 2016, and attacks also rose 27 percent from Q4 2015 to Q1 2016. Account takeovers are quickly emerging to become one of the most common forms of fraud, according to the latest index findings. As of Q1 2016, they accounted for 2 percent of fraud activity in Europe, 4 percent in the United States and more than 25 percent of attempts around the world. The reach of fraud attacks has grown substantially from the beginning of 2015, when less than $2 out of every $100 was subject to a fraud attack. In Q1 2016, the reach of fraud attacks climbed to affect more than $7 out of every $100. Story in PYMNTS.
Get Uber Ride Discounts By Shopping With Visa Cards
Uber has now introduced Local Offers which provide ride discounts when you shop using a Visa card. Local Offers is a way for riders to get free rides by spending at local businesses with a Visa credit card that’s linked to their Uber account. Riders will get 1 Uber point for every $1 they spend at participating merchants and for every 100 points they earn a free ride up to $10. The Local Offers feature has been built right in the Uber app so riders can easily find all of the participating merchants while they request a ride. There are no codes or coupons to manage for this, the points will automatically tally up in the app as soon as the Visa credit card linked to the account is charged for a ride. Local Offers is being rolled out to riders in San Francisco and Los Angeles in the first phase. New cities and merchants will be added down the road. Story by Adnan Farooqui for Ubergizmo.
Excessive Credit Card Surcharges Have Finally Been Banned In Australia
Back in February, the Federal Government passed a bill to give the Australian Competition and Consumer Commission the power to rein in companies that slug customers with a high fee when they pay with their credit cards. Today, the law finally came into effect, which means those ridiculous surcharges are officially banned. Under the new rules, most businesses must charge in the region of 0.5 per cent for debit card purchases, 1 to 1.5 per cent for credit cards, and 2 to 3 per cent for American Express. This is roughly what it costs the merchant to complete the aforementioned transactions. For the first year the law only applies to large businesses with at least 50 employees and a gross revenue of 25 million dollars or more. It will apply to all businesses from 1 September 2017. Story by Chris Jager for Lifehacker.
Apple Plans iPhone for Japan With Tap-to-Pay for Subways
Apple is planning a new iPhone feature for Japan that will enable users to pay for mass-transit rides with their smartphones instead of physical payment cards. A future iPhone will include technology called FeliCa, a mobile tap-to-pay standard in Japan developed by Sony. The FeliCa chip will let customers in Japan store their public bus and train passes on their iPhones. Users would then be able to tap their phones against the entrance scanners instead of using physical cards. The Near Field Communication technology powering Apple’s mobile-payments service, Apple Pay, is prevalent in North America, Europe and Australia, but the FeliCa standard dominates Japan with a penetration of 1.9 million payment terminals. Story by Mark Gurman for Bloomberg.
Now You Can Pay for Uber with Pre-Tax Commuter Dollars
Uber is getting into pre-tax money. Customers can now use their commuter dollars (which aren’t subject to taxes) to pay for certain Uber rides. The move into commuter benefits is through a partnership with WageWorks, a popular national employee benefits platform. It’s a small but important step as Uber looks to make itself more than a ride-hailing service by engraining itself in everyday life. The company has been slowly introducing various new features to attract commuters, including passes for unlimited rush-hour use. The benefits will only be available for rides through UberPool, the shared ride system that has grown as a commuter option. For now, the option is only available in New York, but could eventually roll out to the other US cities that offer UberPool. Story by Emma Hinchliffe for Mashable.
LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 14.64 percent, identical to last week. Six month ago, the average was 14.81 percent. One year ago, the average was 14.60 percent.