This Week In Credit Card News–Consumers Advised To Change Passwords, Credit Card Debt Drops Again

Heartbleed Threat Puts Passwords, Credit Cards, and Other Data at Risk

Passwords, credit cards and other sensitive data are at risk after security researchers discovered a problem with an encryption technology used to securely transmit email, e-commerce transactions, social networking posts and other Web traffic. Security researchers say the threat, known as Heartbleed, is serious, partly because it remained undiscovered for more two years. It’s not known whether anyone has actually used it to conduct an attack. Researchers are advising people to change all of their passwords. [Associated Press]

Americans Owed Less on Their Credit Cards In February

Americans shed more credit card debt in February, the latest sign of consumer caution about borrowing and spending since the recession. Outstanding revolving credit, which includes debt from credit cards, fell $2.42 billion from January, representing an annualized decline of 3.4% in February. Borrowers also have become more diligent about paying off their balances. [The Wall Street Journal]

Bank of America Must Pay $772 Million for Illegal Credit Card Practices

Bank of America was ordered by the CFPB to refund $727 million to consumers who were deceived by the bank’s marketing of credit card payment protection programs and others who were charged for credit monitoring services they never fully authorized. In addition, the Office of the Comptroller of the Currency fined Bank of America $25 million in civil penalties for unfair billing practices. The bank also has to pay $20 million to the CFPB Civil Penalty Fund. [LowCards.com]

Data Compilers’ Secret Scores Have Consumers Pegged–Fairly or Not

Consumers won access to their credit scores more than a decade ago after advocates voiced concerns over errors and lending bias. The secret scores and data are used by employers, utilities, banks, healthcare providers, debt collectors and a host of other enterprises. [Los Angeles Times]

American the Latest Airline to Tweak Flier Program

American Airlines is the latest to tinker with its program. The carrier announced changes that make it tougher to redeem miles
for a flight during busy travel periods, and to check a bag without a fee. They are just the latest example of airlines giving away less as executives increasingly focus on growing profits. [Associated Press]

Walmart Partners with MasterCard for Store Branded Credit Cards

MasterCard will be the new payment network for Walmart’s store-branded credit cards, ending the nine year partnership between Discover and Walmart. MasterCard will also handle all the transactions on the store-branded credit cards for the Sam’s club subsidiary. General Electric’s Capital Retail Bank will be the store card’s issuer. [LowCards.com]

Do These 3 Things to Improve Your Credit Health

So you made some financial missteps in the past, and now you’re paying for it with your low credit score. Unfortunately, there’s no magic potion to fix poor credit. But there are a few serious things you can try to boost your ailing credit health. Fair warning: These tips are not for credit newbies. [U.S. News]

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 14.45%, identical to last week. Six months ago, the average was 14.40%. One year ago, the average was 14.28%. [LowCards.com]

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This Week In Credit Card News–Why Retail Stores Get Hacked, New Details On Target Breach

Why So Many Retail Stores Get Hacked for Credit Card Data

MasterCard, Visa and other card companies require retailers to pass an audit sanctioned by the Payment Card Industry (PCI) Security Standards Council. It turns out the accreditation by PCI doesn’t always offer much protection against fraud. Large retailers can face fines of $25,000 per month for violating PCI’s guidelines. However, the current PCI standard gives every party in the payment system a credible way to redirect blame for a breach. [Bloomberg Businessweek]

Three New Details from Target’s Credit Card Breach

Appearing before the Senate Commerce Committee on Wednesday, Target’s chief financial officer, John Mulligan, provided some new details about the data breach. The amount of fraud on compromised cards has been less than expected and the number of affected customers is likely to be no more than 98 million. In addition, the company is looking into whether it could have prevented damage if it had responded differently. [Bloomberg Businessweek]

California DMV Probing Possible Breach of Customers Credit Cards

The California Department of Motor Vehicles said that it is investigating a potential security breach of its processing of credit cards. The DMV was alerted by law enforcement officials about the possible breach and has “heightened monitoring” of all of its Web traffic and credit card transactions. [Los Angeles Times]

Appeals Court Upholds Current Fees on Debit Card Purchases

In the latest chapter of the debit card fee wars, the banks and Federal Reserve were dealt a victory when a federal appeals court overturned a lower court’s decision. The ruling means that the amount banks collect from retailers when consumers swipe debit cards can remain as is. The takeaway message for consumers: Nothing much will change, at least for now. [New York Times]

Retail Groups Say Credit Card System Needs Overhaul

The nation’s debit and credit cards are prone to fraud and need a major overhaul. That was the message the National Retail Federation, the world’s largest retail trade association, brought to the U.S. Senate. The federation charged that banks’ insistence on cards that use a signature instead of a Personal Identification Number puts merchants and their customers at risk. [Salt Lake Tribune]

Russia Gets Ready for Life Without Visa and MasterCard

After Visa and MasterCard stopped processing some Russian transactions in response to U.S. sanctions, Moscow says it could launch a homegrown payment system that could be ready in as little as six months. Moscow has been preparing for the past few years to issue an electronic payment card that citizens could use for transactions with the government, such as tax and pension payments. Expanding that to include private purchases wouldn’t be hard, says an analyst at Gartner Research. [Bloomberg Businessweek]

Don’t Bank on High-Tech Credit Cards

As companies invest more in each EMV card, they’re also extending the card’s life span from the average two or three years until expiration to about five years to save the cost of issuing new cards. Geolocation features that sync credit cards with smartphones to make sure they’re in the same place during a transaction have more hope of taking off, because while they add an extra layer of protection, they don’t ask consumers to change their behavior. People already carry their smartphones. [MarketWatch]

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 14.47%, identical to last week’s average. Six months ago, the average was 14.38%. One year ago, the average was 14.29%. [LowCards.com]

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This Week In Credit Card News–Card Hackers Using Blackmail, Are Loans Now Easier To Get?

Forget Stealing Credit Cards, Now Hackers Straight-Up Blackmail You

While hackers tried to get rich by stealing millions of credit cards from Target, other cybercriminals have quietly tried another method to make a quick buck: asking companies to pay them to go away. Cybercriminals have threatened to disclose sensitive data or cripple websites unless their victims pay hundreds or even thousands of dollars in ransom. [Huffington Post]

Loans are Finally Easier to Get

It’s easier to get a loan these days for a new home or car than it’s been in five years–the darkest days of the Great Recession. To be sure, for some borrowers the purse strings are being loosened only a little but the lending landscape is far from normal, experts say. It’s still very difficult for borrowers with tarnished credit to borrow, and even on credit cards, where banks are more willing to lend, regulatory changes have generally lowered borrowing limits. [The Wall Street Journal]

What’s More Valuable: A Stolen Twitter Account or a Stolen Credit Card?

Stolen Twitter accounts are now more valuable than credit cards on the cybercrime black market, according to a new report. Recent hacks have created an influx of available credit card data online. This has made the card data less valuable, especially when banks react to hacks by cancelling and replacing stolen cards. But the supply of stolen social media accounts rarely surges. [The Wall Street Journal]

Wells Fargo Continues Credit Card Push

For the past year, Wells Fargo CEO John Stumpf has had a major corporate directive for his bank to capture a greater share of the credit card market. This week, the bank announced that it fund, issue and service Dillard’s-branded private label and co-branded credit cards. In addition, the nation’s fourth-largest bank will manage the retailer’s cardholder loyalty program. [LowCards.com]

Postal Workers Use Government Credit Cards to Gamble, Bowl

Using government credit cards, postal employees have spent thousands of taxpayer dollars on gambling, bills and other personal expenses, according to a series of reports by the U.S. Postal Service inspector general. [Washington Examiner]

Latest Cyberscam Enables Crooks To Extract Huge Sums from ATMs

Regulators are warning bankers that hackers have succeeded in changing the controls on automated teller machines to enable thieves to make nearly unlimited withdrawals using fraudulent debit, prepaid and ATM cards. The hackers often schedule the withdrawals for holidays and weekends, when extra cash is loaded into ATMs and monitoring by the banks drops off. [Los Angeles Times]

Some Americans Paid Off Credit Card While Waiting for Foreclosure

The sheer number of foreclosures during the recession may have helped some Americans pay off other debts, such as credit cards. The time it took to process these foreclosures increased, allowing people to remain in their homes longer without making mortgage payments, freeing up money for other expenses, according to research from the Federal Reserve Bank of Philadelphia. [The Wall Street Journal]

Time to Reconsider Your Airline Credit Card?

If you have an airline credit card, now may be the time to ditch it for something better. Delta is the latest airline to revamp its program to reward people based on how much they spend for their tickets, rather than how far they fly. These program changes don’t bode well for leisure travelers, who may find themselves grounded when they try to cash in their miles for flights. [Fox Business]

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 14.45%, slightly below last week’s average of 14.47%. Six months ago, the average was 14.40%. One year ago, the average was 14.29%. [LowCards.com]

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This Week In Credit Card News–How To Prevent Card Fraud, A Return To Reverse Mortgages

Consumers Not Powerless in Face of Credit Card Fraud

Most card companies already have custom alerts and other features that few consumers use. An on/off switch accessible from a mobile app that could keep most fraud from happening or microchip cards that most of the rest of the civilized world uses but that barely exist in the United States so far. [New York Times]

Baby Boomers Turn to Reverse Mortgages

U.S. baby boomers desperate for retirement income are increasingly turning back to a financial product that, after the housing bust, had been left for dead: the reverse mortgage. A reverse mortgage allows retirees to borrow against their home, and they don’t have to make any payments on the loan until they move or die. Borrowers took out $15.3 billion of the loans in 2013, an increase of 20% from the year before, according to industry publication Inside Mortgage Finance. The record year was 2009, when there were $30.21 billion of reverse mortgage loans made. [Reuters]

Retailers Late to 2015 Credit Card Deadline Face Increased Fraud Risk

The October 2015 roll out of new chip-based credit card technology for U.S. retailers and payment processors might seem far off, but merchants who come late to the party could find themselves increasingly at risk of card fraud. After October 2015, liability for fraudulent transactions will shift to whichever party has the lesser technology. That means a merchant can still a run swipe and signature transaction, but could be held liable for the costs of fraud if the consumer is using a chip-enabled card. [The Wall Street Journal]

Millennial Come of Age with Less

It’s no secret that many members of the so-called millennial generation are struggling financially and they may be the first generation to be worse off than their parents. In looking into the finances of millennials, a study found that an overwhelming majority of them feel stretched by their car payments, credit cards and other bills. Only 57% with access to a workplace retirement plan are contributing enough money to take full advantage of the employer match. [Philly.com]

With Credit Card Data in Play, Who Hacks the Hackers?

Not even hackers are immune to hacking. Websites that were used to sell credit card data stolen in the massive holiday data breach at Target were themselves shut down by unknown culprits Monday. [The Wall Street Journal]

Borrowers Paying Mortgages Over Credit Cards Again

As the housing market and hiring continue to recover, consumers are making their mortgage payments a priority again, reversing a trend first seen in September 2008, according to a TransUnion study. [CNN Money]

U.S. Bank Creates Problem for Consumers with New Debit Cards

U.S. Bank has started sending out new debit cards to its customers as a result of recent data breaches at major retailers. Cardholders have just two days to activate their new cards before the old ones are terminated. This could cause major issues for patrons who are away on vacation, have problems receiving their mail, or who simply take a few days to open their mail. [LowCards.com]

CFPB’s Spending Skyrockets Nearly 50 Percent

Spending at the Consumer Financial Protection Bureau went up nearly 50% from 2012 to last year, according to the Federal Reserve. The financial statement shows that in the budget year ending Dec. 31, total spending for the CFPB increased from $385 million in 2012 to $563 million, a 46% hike. [Washington Examiner]

Big Data Used to Catch Fraudulent Tax Returns

Identity thieves are stealing billions of dollars a year through fraudulent tax refunds–and the IRS isn’t the only target. Georgia, Indiana and Louisiana now contract with LexisNexis Risk Solutions to screen all of their returns against its massive database of public information. When LexisNexis finds a suspicious return, it’s flagged and set aside. [CNBC]

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 14.47%, slightly lower than last week’s 14.49%. Six months ago, the average was 14.39%. One year ago, the average was 14.30%. [LowCards.com]

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Prepaid Cards And Vegas Slots Are A Bad Combination

Las Vegas is famous for its ill-conceived unions. Celebrity couples (and countless non-celebrities) like Elvis and Priscilla Presley and Richard Gere and Cindy Crawford have gleefully gotten hitched in Las Vegas, only to part ways a short time afterwards. Unfortunately, the latest bad Vegas marriage – that of prepaid debit cards and casinos – will last a lot longer than the nine days self-designated diplomat and former basketball star Dennis Rodman and Carmen Electra managed to stay together.

In February, at the urging of the city’s powerful casinos, the Nevada Gaming Commission voted unanimously to allow gamblers to utilize prepaid debit cards tied to individual casinos’ rewards programs. Supporters of the change point to a number of benefits the introduction of plastic to the casino floors will have. Among them is a reduction in the money casinos have to spend to process so many cash transactions, which will undoubtedly be a boost to the companies’ bottom lines. According to Shane Tripcony, also c0-founder of BestPrepaidDebitCards.com, “This could be a huge win for the casinos.  It reduces costs while at the same time making it easier for people to access funds for gambling.  For consumers, it definitely adds convenience, but one must ask at what long-term cost?”

6e897130a28164ec5dee110dd6e8e465 Prepaid Cards And Vegas Slots Are A Bad Combination

Other cheerleaders for the use of prepaid debit cards in Vegas say there are ample safeguards in place to keep gamblers in check. For instance, a maximum of $2000 per day and $10,000 per month can be loaded onto prepaid cards used in casinos. And a player can have no more than $25,000 on their card at one time.

For consumers, particularly those who may be suffering from the very real problem of gambling addiction, there are no real benefits. Yes, it is true that allowing prepaid debit cards to be used in casinos is a far better development than if debit or credit cards were permitted. Imagine how much easier it would be to make a truly life-altering financial misstep if, in the rush that seems to accompany so many gamblers while they’re playing, it was simple to siphon money out of a checking or credit card account straight into a slot machine.

But the choice here was not between prepaid cards and their debit and credit brethren. The choice was whether or not to upend the exclusive use of cash to include prepaid debit cards. The gaming commission made the wrong choice. Why? One of the very best brakes on impulsive gamblers is the fact that they have to get up and go get cash out of an ATM whenever they run out of money. Those sobering (literally or figuratively) moments along with the steep ATM fees typically charged at Vegas casinos has no doubt saved many people from spending money they don’t have over the years.

And now it is gone, without even a honeymoon.

 

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