Reports Accross US, Citi Bank Closing Credit Cards without Warning

[Camtender]

http://www.msnbc.msn.com/id/33388210...-consumer_news


Citi closing Mastercards without warning

People across country reporting their cards linked to gas companies denied

Citibank Cancels Exxon-Mobil, Shell, and Conoco-Philips Co-Branded Credit Cards without Warning

The Associated Press

updated 8:39 a.m. PT, Tues., Oct . 20, 2009


NEW YORK - Shannon Burdette tried to pay with her Shell Mastercard after filling up her gas tank this weekend but found the card rejected.

Confused, she called the customer service line on the back of the card, issued by Citibank, and was told the account was closed because of something that appeared on her credit report. But when the Sykesville, Md., resident got a copy of her credit report online, the only negative thing she saw was "closed at credit grantor's request" on the Shell MasterCard account.

"They said there was a routine review," said Burdette, who maintained that she and her husband, Brian, used the card regularly and always paid the bill on time.

Burdette isn't alone. People across the country have been reporting similar experiences in postings on various consumer Web sites.

Citi confirmed the basics. The bank said in a statement it "decided to close a limited number of oil partner co-branded MasterCard accounts." That includes not only Shell, but Citgo, ExxonMobil and Phillips 66-Conoco cards.

"It is kind of an extraordinary action, but these are extraordinary times," said Ben Woolsey, director of marketing and consumer research for CreditCards.com.

He noted that Citi is not the healthiest bank. In fact, Citi posted $8 billion in consumer credit losses for its third quarter last week, including both mortgages and credit cards. Like many banks with big consumer lending portfolios, Citi is expecting defaults on credit cards to rise in coming months. Credit card delinquencies typically track the unemployment rate, which is at 9.8 percent and is expected to top 10 percent soon.

Analysts noted following the earnings report that Citi has sharply reduced its outstanding credit to consumers.

[Slimprofits]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

I'm seriously surprised that this hasn't resulted in a violent backlash. No one shot up a gas station over this?

I was thinking last night about what's going to happen if the dollar is devalued overnight.

[Slimprofits]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

I hope this causes a run of massive proportions on Shitty.

I think people that previously did all of their banking with Shitty are going to move a sizable chunk of their remaining assets to other institutions.

Would love to walk by a dumpster one day and see Pandit and company scrounging through my trash.

[MulaMan]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

I think we should stop all credit cards for the rest of the year. A credit holiday....

just so deadbeat Americans find out how luckly they are to have these banks lending them thier own money at usuary rates.

[ggirod]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

I think we should stop all credit cards for the rest of the year. A credit holiday....

Better yet would be if everyone continued paying down (if necessary) but otherwise quit using their credit card accounts for the rest of the year. You would see a lot of concerned oligarchs. In fact if people didn't get around to starting to use them again, it wouldn't be all that bad either.

My mantra is increasingly ... Cash ... Don't leave home without it.

[Please pardon this incursion into dreamland ...] Given time, little neighborhood stores could open up again, where the owners kept a small tab so people could get bread and milk a day or two before payday if needed. That worked pretty well in my youth ... For that matter, parents could send kids to the store with a list, the merchant would record it on the tab, and the parent would take care of it a few days later when they were in there. Big chains would be unable to cope with that sort of complexity but small personal relationships could thrive again. In the '60s I extended credit to my customers and never got taken. Oh, once in a while a customer would have some sort of reversal and have to pay a week or two late, but that simply strengthens relationships, it doesn't harm them. Personalized credit pretty much controlled abuse and non-payment before it got out of hand, so no collection agency was needed. It is probably amazing how the few percent of gross that now goes to credit overhead could be reallocated. Maybe once a month people could drive or carpool to do major shopping at centralized supermarkets but for most things the neighborhood market would suffice. Over time stores could open up every few blocks so they were within convenient walking distance. Local farmers could make regular rounds delivering basic produce in the stores so people could get fresh produce conveniently. Ultimately nobody would need to get in the car and spend two dollars in gas driving to the store when they could just walk over there with the kids in tow, all getting exercise. A little zoning change and foreclosed houses could provide the real estate at very reasonable prices. People who would otherwise finally end up working at Walmart might be able to work at or own neighborhood stores ...

Now, ... Chris Coles, can you figure out how this can be funded primarily by equity so that there is no interest at all to be paid in the game? It would be nice if the owner could just own the inventory and pocket/share the earnings with investors. As business grows the investment could be increased a bit to keep up. Maybe a coop model would work with reasonable coop investments by regular customers who would then get a discount. That is equity funding too, I think.

Sometimes we get so wrapped up in how things are that we forget how things were. People forget that things worked pretty much OK before somebody played with matches and everybody got burned with FIRE.

All this with a credit holiday. Not a bad idea at all :-)

[Quincy K]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

If the Banksters are truly cutting credit, then this is not going according to the plan.


In fact, this is very, very bad for the inflationist's theory.


What good is a printing press if you aren't allowed to print?

[cjppjc]

Nice guys

http://blogs.moneycentral.msn.com/to...stercards.aspx

Could banks have any less respect for their customers?
Citibank (C) has begun closing customers' accounts without telling them. That's a bitter surprise for some people who pull out their cards to make a purchase, only to learn that the card has been denied.
This isn't anything new, but it's a trend that's starting to involve more banks and affect more customers who least expect it. Pay your bill on time and keep a low balance? Doesn't matter. All types of accounts are getting hit.

• Find a better credit card

One woman tried to pay for gas, according to the Associated Press. Citibank said it was because of something that appeared on her credit report. But when the woman accessed her credit report, it only said, "Closed at credit grantor's request."

The woman said she used the card regularly and always paid the bill promptly, according to the AP. Other people have reported similar incidents. Read this person's story for more.
And it isn't just Citibank that's yanking cards. The Wall Street Journal has the story of how American Express (AXP) suddenly canceled the card of one woman earlier this year. The woman -- a lawyer, in fact -- was told that her card was canceled because of information in her credit report.
That seems to be a standard line for credit card companies. And though it seems like bad business, experts tell the Journal that it is legal for companies to cancel cards without warning.
Customers have reportedly been affected by this at Bank of America (BAC), JPMorgan Chase (JPM) and HSBC Holdings, according to the Journal.

In Citibank's case, the company said it decided to close some MasterCard accounts that were co-branded with oil companies, including Shell, Citgo, ExxonMobil and Phillips 66-Conoco.
It's fine to close customer accounts. That's business, and banks do it all the time. And in this economy, credit-card companies are getting killed as people who have lost jobs abandon payments. Banks are responding with panic, raising interest rates and fees and canceling cards to try and minimize risk.
What gets me, however, is the way Citibank did it.

AP reports that Citi closed the accounts on Wednesday, but sent out letters Monday informing customers of the change. So Citibank waits until the last minute to tell customers, most of whom probably didn't receive the news before their cards were shut down.
Way to leave your customers in the lurch.

[jk]

Re: Nice guys

Way to leave your customers in the lurch.

EX-customers

[cjppjc]

Re: Nice guys

The amount of consideration and worry that their actions are producing a backlash is......none.

I am seeing much more anger from the MSM towards Wall Street and big banks. Maybe the bullhorn soon.

[cjppjc]

Re: Nice guys

Just saw this has already been posted. Well I think this is the first time it happened to me.:mad:



Thanks for the merge Fred.

[stanley2008]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

It sounds like the credit card companies don't think some of their customers are going to be able to pay off their balance. Wonder why.

[stanley2008]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

If the Banksters are truly cutting credit, then this is not going according to the plan.

In fact, this is very, very bad for the inflationist's theory.

What good is a printing press if you aren't allowed to print?

Yeah, but why should they extend credit to deadbeats who ring up their cards to the max, can barely pay their mortgage and are about to lose their job.

I dont' think the banksters are really doing the cutting! There are just fewer eligible sheep to be shorn. For guys who pay up, there is always credit! For guys who don't appear to be able to pay, yeah, the credit is "cut off" - "oh those dirty banksters" - not quite. They are not offering credit terms to do you a favor - they do it in hopes that you get a little behind and start having to pay interest, but they want you to be able to stay afloat!

It's all fine if they have something they can take away from you (even a house in florida) when you don't pay down the balance every month in full, in this situation, they are happiest if you make minimum payments at loanshark interest rates. That is when people should have been complaining. But nope, many people who have credit cards pay interest to these sharks without any complaint - which to me is very surprising! But if and when you, the customer, compute out to be a financial loser, yeah that's actually risky for the credit card company, so they don't need you anymore as a customer - for real. It makes perfect sense.

They are in it to make money right? We all know this.

Responsible use of credit - learn it and enjoy it.

[touchring]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

I think we should stop all credit cards for the rest of the year. A credit holiday....

just so deadbeat Americans find out how luckly they are to have these banks lending them thier own money at usuary rates.

I canceled my citibank credit card just 3 months ago as i wasn't using it much and didn't want to spend time checking the account for unauthorized transactions. The other reason - I've put my wallet on a trimming regment.

I'm down to a local bank credit card which i use for gas discounts..

[Rajiv]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

A few great videos on this subject

Frontline - Secret History of the Credit Card (2004)

The average American family today carries 10 credit cards. Credit card debt and personal bankruptcies are now at an all time high. With no legal limit on the amount of interest or fees that can be charged, credit cards have become the most profitable sector of the American banking industry: more than $30 billion in profits last year alone. FRONTLINE examines how the credit card industry became so pervasive, so lucrative, and so powerful.

In Debt We Trust

IN DEBT WE TRUST is the latest film from Danny Schechter, "The News Dissector," director of the internationally distributed and award-winning WMD (Weapons of Mass Deception), an expose of the media's role in the Iraq War. The Emmy-winning former ABC News and CNN producer's new hard-hitting documentary investigates why so many Americans are being strangled by debt. It is a journalistic confrontation with what former Reagan advisor Kevin Phillips calls "Financialization"--the "powerful emergence of a debt-and-credit industrial complex."

While many Americans may be "maxing out" on credit cards, there is a deeper story: power is shifting into fewer hands.....with frightening consequences.

and Maxed Out

Maxed Out takes viewers on a journey deep inside the American style of debt, where things seem fine as long as the minimum monthly payment arrives on time. With coverage that spans from small American towns all the way to the White House, the film shows how the modern financial industry really works, explains the true definition of "preferred customer" and tells us why the poor are getting poorer while the rich keep getting richer. Hilarious, shocking and incisive, Maxed Out paints a picture of a national nightmare which is all too real for most of us."

[Anon21456]

Re: Reports Accross US, Citi Bank Closing Credit Cards without Warning

Is Citi bankrupt ? Are they becoming more risk-adverse ? Both ?