LowCards.com Weekly Credit Card Update–September 16, 2016
Credit Card Agreements: Profiles in Gibberish
Go ahead and admit it: You don’t read your credit card agreements. You probably can’t even remember the last time you picked your way through the entirety of one of those single-spaced, dripping-with-legalese contracts. Don’t sweat it. You’re not alone. Surveys show that about three-quarters of consumers never read the fine print of financial documents. And of those who actually make the effort, a significant proportion come away not understanding what they’ve been told. So it’s not a huge surprise that the vast majority of card agreements are beyond the reading ability of average Americans, even though the Consumer Financial Protection Bureau called in 2011 for the banking industry to make the darn things more readable. Story by David Lazarus for the Los Angeles Times.
A Third of All Americans Hacked in the Past Year
More than one-third of Americans (37%) experienced a computer virus, hack or other cyber attack in the past 12 months, according to a recent study. The most common attacks were viruses (69%). Of those who had been hacked, 42% were between the ages of 18 and 24. Only 22% were over the age of 70. These attacks were costly to consumers. The nationwide survey, conducted by Zogby Analytics on behalf of HSB Insurance company, found the victims often had to spend money to recover. In 23% of the cases, victims spent between $1,000 and $5,000, while 56% spent less than $500. Usually, the costs were associated with restoring data and purchasing software. Story by Bill Hardekopf for LowCards.com.
ClixSense Data Breach Exposes Personal Information of Millions of Subscribers
ClixSense has become the victim of a cyberattack which has led to the data of millions of users being put up for sale. This week, ClixSense, a website which offers users cash in return for completing surveys and watching ads, admitted to a data breach in which an attacker was able to gain access to the firm’s database. The unknown attacker was able to use an old server which the company was no longer using–but was, at the time, still networked–to gain access to the main database. After gaining entry, the cybercriminal was able to copy “most, if not all” of the ClixSense users table, changed account names to “hacked account” and deleted a number of forum posts–as well as set user account balances to a zero balance. Story by Charlie Osborne for ZD Net.
MasterCard Seeks To Stop Online Fraud With Selfies, Fingerprints
MasterCard plans to launch new biometric technology for verifying customer identities during online shopping transactions in the coming weeks with merchants and banks. The company has been testing facial and fingerprint recognition software, called Identity Check, in the Netherlands, Canada and the U.S., as a way to combat growing online fraud. Story by Kim S. Nash for The Wall Street Journal.
Bill to Repeal Debit Card Swipe Fee Reform Moves Out of Committee
The Financial CHOICE Act, legislation that repeals the debit card interchange fee reform, passed out of the House Financial Services Committee by a 30-to-26 vote on Sept. 13. U.S. Rep. Jeb Hensarling (R-Texas), chairman of the House Financial Services Committee, recently introduced H.R. 5983, the Republican alternative to the Dodd-Frank Act that seeks, among other goals, to repeal debit card reforms created by the Durbin Amendment to the Dodd-Frank Wall Street Reform Act. The new legislation, if it becomes law, would repeal the Federal Reserve’s cap on debit card swipe fees and undermine competition, according to the National Retail Federation (NRF). The proposed bill would allow for new, higher, hidden swipe fees that could more than double without competitive routing options and the cap that are currently in place, it said. Story by Greg Lindenberg for CSP Daily News.
Prestige Credit Cards are a Big Hit with Millennials
The Chase Sapphire Reserve card was so popular out of the gate, that the company ran out of the metal alloy used to make the cards. People are even uploading unboxing videos to YouTube. The cards have become a viral phenomenon of sorts, thanks in part to effusive praise from travel sites and bloggers. So, what’s going on? Well, for one, Chase has a pretty attractive sign-on bonus—100,000 points worth up to $1,500 in free travel, a benefit really popular among young people who tend to favor experiential purchases over status. Story by Adam Allington for Marketplace.
Cartels Put Their Money Laundering on Corporate Credit Cards
Organized crime groups are getting creative with credit cards to move illicit proceeds across international borders without setting off regulatory alarms attuned to cash deposits, money wires or automated transfers. Transnational organized crime (TOC) groups have dealt with the perennial problem of moving value across borders undetected. At some point all of these groups deal with the three steps in the money laundering process, but the first one, placement, is potentially the most hazardous hurdle to overcome. TOCs ship drugs to the United States via various means and have their major distribution hubs sell the drugs to other dealers. Story by Keith Furst for InSight Crime.
What Your Credit Card Offers Say About You
Do the credit card offers you receive in the mail have photos of enticing holiday destinations and reward miles? If so, you should be flattered, since this means that credit card issuers believe you to be highly educated and financially sophisticated. But if you are receiving card offers with low teaser rates for introductory APR, you might take offense, since card issuers most likely do not view you as savvy. As more and more personal data becomes available, businesses are now able to target customers in a personalized and sophisticated way. On the bright side, that means you can get products and services that are tailored to your needs. As a result, you are much less likely to get catalogs featuring dresses your grandmother might wear. But, according to our research, the downside is that companies can also more effectively target your behavioral weaknesses, self-control issues or lack of attention to the fine print. We find that credit card companies tend to offer those customers who are least able to manage the complexity of credit card contracts, the most complex features and hidden charges. Story by Antoinette Schoar for The Wall Street Journal.
Workers Paid by Card Will Gain Protections in New York State
Workers in New York State who receive their wages on prepaid cards will gain consumer protections next year that advocates say are among the strongest in the nation. The new rules are intended to guarantee that employees do not have to pay any fees to gain access to their paychecks. An estimated 200,000 workers in the state are paid through debit cards, and activists have for years complained about high fees, concealed costs and other abuses. Under the new rules, released on Thursday by the New York State Department of Labor, employees who are paid on debit cards must be allowed to make unlimited, free withdrawals from their cards from at least one A.T.M. located “a reasonable travel distance” from their home or work. Story by Stacy Cowley for The New York Times.
Consumers Fear Bank Account, Credit Card Hacks
People are most fearful of their credit cards or bank statements being hacked, with 78 percent of Americans and Germans ranking it a top online security concern, according to a new study. That number is even higher in the UK, where 85 percent of residents rank credit card and bank data as their biggest hack concern. Respondents to the survey, which polled 2,400 people across the United States, U.K. and Germany, also indicated they were willing to invest time in completing security tasks if it makes them safer. More than half of all Germans (52 percent) expressed a willingness to spend at least 10 minutes on security measures, followed by 46 percent in the United States and 30 percent in the U.K. Story by Nathan Eddy for eWeek.
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 14.66 percent, slightly higher than last week’s average of 14.64%. Six month ago, the average was 14.80 percent. One year ago, the average was 14.59 percent.