ChangeInTerms.com has just released a new eBook entitled, “How Chase Card Services Stole Christmas.” While its author, Dr. Robert Lahm, considers the work to be a parody, it contains a serious message, and chronicles his (and his family’s) battle with credit card companies.
Part of this eBook’s message is associated with observations about the impact that Chase’s new change in terms notice may have not just on account holders, but on the economy at large, as Americans continue to struggle. The aforementioned notices were distributed by Chase over the last several weeks, and took effect as of January 1, 2009. Their primary characteristics were raising monthly minimum payments from 2% to 5% of the account balance, adding a $10 monthly “finance charge” (even if the account has no balance), and providing no “opt out,” which is contrary to a previous statement delivered by a Chase marketing executive in testimony before Congress. In the absence of an “opt out,” says Lahm, the consumer has no “escape hatch,” and is trapped.
While these changes could prove to be devastating to consumers, Lahm is just as concerned about the impact on individuals who are operating small businesses. Citing SBA (Small Business Administration) figures, he has indicated that over 99% of all businesses, are small businesses. According to his academic research, about which he has previously provided testimony before before Congress himself, entrepreneurial “bootstrappers” (people who start a business with little or no capital) comprise the majority of all start-ups, and they often rely on both personal and business credit cards.
In the case of his own loan with Chase, which was originally promoted as one that had a “fixed rate” of 3.99% for the life of the balance, Lahm estimates that his payments will skyrocket from $239 per month to almost $600 per month on a balance that is just under $12,000. Most of his debts (discussed in the eBook), are associated with attending graduate school, which included some challenges along the way. His intent was to become academically qualified to teach at the college level, and he is now an Associate Professor of Entrepreneurship. Lahm outlines his payment history, which he states has been flawless over many years and types of obligations, both commercial and consumer oriented in nature.
ChangeInTerms.com is a consumer protest site, created by Dr. Robert Lahm (a university entrepreneurship professor), in response to credit card companies and their mistreatment of many account holders (including himself). The site provides vibrant discussion and analysis, links to government, regulatory, and advocacy organizations, and sometimes more than a little sarcasm — along with serious critique — about the activities of credit card companies both individually, and as an industry. While the site laments that it can’t actually change terms from a legal perspective, it submits that they can be changed with credit card companies from a consumer perspective. The site’s description declares to credit card companies: NOW WE’RE COMING AFTER YOU.
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on Jan 4th, 2009 at 7:52 pm
I have done all of the things you advise. All in the week after I got my absolute response from Chase that they were willing to let my business walk rather than honoring the agreement they made with me.
I am paying them off (and everyone else too) with a REFI of my home.
One of my state senators responded that he would have an aid look into it. None of my other congressmen even responded. I contacted 4 talk shows and all my local papers. No response at all.
My State Attorney General told me that it was an OCC issue and that I should not contact his office again about this matter.
The OCC never responded to my letter.
I posted on several sites. I saw your post on one of them and looked at your site.
I have done all that I can think to do and as I said have a plan to extract myself from this extortive construct but know that many will not have the options that I have and see this as something which government should prosecute.
I have contacted you because hope that somewhere this opposition will coalesce and sufficient mass will build that it will no longer be ignored. When that happens, I want to be there.
My story is a little different in the respect that I was stupid enough to let them screw me twice. I paid them off once because they started raising my rates (APR) every month when Chase bought/merged with Bank one. No problems with my paying or credit, they just wanted more money. They referred me to the language of the cardholder’s agreement, which allowed it. I realized I was vulnerable and paid them off with a second mortgage.
I wrote a nasty letter to the corporate office telling them that I had been a good customer for 15 plus years and would never be again because of this instance.
4 months later I received a personal call from Chase. This person identified himself as an account retention manager and said that he had been told to apologize and see if he could set it right. He thanked me for my letter and told me that my experience had all been a mistake and the people who had caused it had all been dealt with appropriately.
He asked me to come back. 3.99% for life. He assured me that the transferred balance would not be subject to the cardholder agreement and that the terms would never change unless I did not pay on time. I agreed and transferred over 30K back. This person promised to document all of this in a letter and send it. I never received it. I never received a new cardholder agreement either, or new cards and everything was hunky dory for over two years so I thought it was on the up and up.
Let me know if you see a crack in their armor.
on Jan 4th, 2009 at 8:07 pm
Still can’t post Doc, so I just dumped it in as a comment.
By the way, I finally got a call-back from the OCC.
Voicemail message with a contact number of an eager public servant ready to rescue me from the rightful pennance I must pay for being a as agreed cardholder to Chase.
With baited breath, I await salvation.
on Jan 4th, 2009 at 9:57 pm
Hi Marv,
I received a form letter from the OCC today. I do not expect anything to come of correspondence from an regulatory authority, other than the standard line: Chase can do as it pleases. I will be surprised to see a positive result in favor of consumers.
That being said, I am absolutely sure that responding to complaints is costly and time consuming for Chase, and I intend to see to it that the additional $10 “finance charge” becomes a net loss, many times over. From a consumer perspective, we can do as we please, too, and continue to fight back on all fronts. Hope you like the eBook I just posted, “How Chase Card Services Stole Christmas“! Share it with your friends, and their friends, and so on — spreading the word, far and wide, about Chase and it’s despicable business practices is the ultimately going to be our “salvation.” This needs to blow up in their faces and be a marketing textbook case study in what not to do, a few years from now.
Thanks for persisting on the posting issues with regard to this site (and the blog software — as I mentioned in corresponding with you earlier, I am still trying to learn how to use WordPress). I think I have that resolved now, in terms of being able to receive comments (and approve them, as I have now just done for yours — I’ll take anything legitimate, I just don’t want a bunch of SPAM cluttering up the site, since we are talking about some really serious issues here). Best wishes to you, Marv.
on Jan 4th, 2009 at 10:12 pm
Hi Marv,
Here is what I see:
I have written to Senators, the OCC, the FTC, and other regulatory authorities regarding Chase and its larcenous minimum monthly payment increase. Of course, I have also sent a certified letter to Gordon Smith, the CEO of Chase Card Services.
Unfortunately, the American consumer has not been represented on this matter by members of their government, and it does not appear that the situation will improve unless we work together, and fight. Government is not the answer (it’s the problem — many of our so-called representatives have been “bought and paid-for” by the credit card companies and their lobbyists). Advocacy organizations are on our side (but that’s not enough).
We must use the media, and viral marketing (things like eBooks, and YouTube videos that spread and take on a life of their own). This is grassroots work I’m talking about here; the financial services industry is among the largest in terms of advertising expenditures and major national media has been soft on this issue of credit card company abuse, for years).
We cannot fight credit card companies on their own ground — the turf where lawyers and lobbyists rule. We must fight by denying them our business, contacting their affinity “partners,” and otherwise doing all we can to “out them” as unscrupulous organizations publicly (especially their sleazy executives – this isn’t “just business”; if you’ve got a family to feed, “it’s personal”). These credit card company executives are evil-doers, and I hope to provide them with the embarrassment that they deserve (I’d like to see them convicted of perjury). We need thousands of “letters to the editor.” While you are writing, ask why your elected representatives are allowing FILL IN THE NAME OF YOUR STATE citizens to suffer these abuses.
on Jan 5th, 2009 at 11:00 am
[...] UPDATE: After this post, I wrote and have now released an ebook on this topic. [...]
on Jan 6th, 2009 at 2:30 pm
Robert, on behalf of the other 780,000 Chase balance transfer holders who Chase has recently decided to abuse and deceive, thank you for the initiatives you’ve taken. I have already canceled my other Chase cards, and will be speaking to the various regulatory bodies and the media.
on Jan 6th, 2009 at 2:36 pm
Good for you, Marc. I am “right there with you,” on most of the same things that you are describing (my FICO is in the high 700’s as well). I fully intend to do everything in my power to make this a “textbook marketing case” in what not to do (no theory here, just plain common sense that if a company is this blatant in its acts of deception, there should be repercussions). I am amazed that Chase’s greed (with the FED funds rate) seems so shameless. I finally received a response to my own letter to the CEO of Chase (on the “About” page — I’m using a reply button on this site with no linking, at the moment), and it was boilerplate, offering the same “helpful” spirit that you described (I could end the pain and get rid of the $10 fee if only I would allow Chase to double the rate). This site, my new eBook (hope people with spread that: http://www.changeinterms.com/join-the-fight#ChangeInTerms_Supporter_Images), and a ton of faxes, letters, and emails thus far constitute my answer (thanks but no thanks)! Take care.