Credit Cards

AP - Pope Benedict XVI became the first pope to visit an American synagogue Friday, bringing greetings for the Passover holiday and accepting gifts of matzo and a seder plate. Benedict, 81, stopped briefly at Park East Synagogue on Manhattan's Upper East Side, near the Vatican residence.

Recent headlines have criticised credit card companies for not making their terms easily enough understood by consumers, who claim harsh rules laid down by banks and card issuers are buried away in the small print and don't become clear until it's too late. For instance, millions of consumers every year take advantage of 0% balance transfer and purchase credit card deals as a way of cutting debt in order to mend their financial problems.

Sadly, many of these consumers do not realise that, despite the 0% interest rate, they still need to pay the minimum repayment each month, typically 2 or 3% of the balance. Instead they think 'interest-free for 12 months' means not having to pay anything for 12 months. As a result, when they receive their first monthly statement they pay nothing, thinking everything is in order.

This oversight will in most cases result in the credit card company immediately imposing a fee and raising the interest rate to a significantly higher level, known in the credit industry as 'default and lose'.

Confirming this disconcerting trend, The Office of Fair Trading (OFT) last week published a report entitled 'Credit card comparisons', available for free from its website, saying the market remains too complex, unclear and difficult for borrowers to compare deals.

Among its recommendations to rectify the confusion the OFT calls for standardisation in presenting information, such as summary boxes containing the interest rate and other payment information about the card, on every monthly statement in order to be more user-friendly and avoid unpleasant surprises for the cardholder.

According to the survey, the most common reason for consumers choosing a particular card is a recommendation by their bank, which of course has a vested interest. In order to get a better idea of which card is right for them, there are several websites that allow consumers to compare credit cards from the comfort of their homes. Not shopping around before committing to a credit card is quite possibly throwing money down the drain, something especially hazardous to consumers already struggling with existing debt.

John Fingleton, OFT Chief Executive believes that it is essential that consumers are provided with the correct tools in order to make comparisons between credit cards more easily; and with some of the recently announced recommendations receiving widespread support from industry bodies including the FSA and APACS, it is hoped these new measures will ensure more transparency in the credit card industry and help find consumers the right credit card for their needs.

Isla Campbell is an online, freelance journalist and avid traveler and pilates devotee. When not on the road she lives on the outskirts of Oban.

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AP - Al-Qaida's No. 2 said in an audiotape released Friday that the United States will lose whether it stays in Iraq or withdraws, and he sneered that President Bush just wants to pass the problem on to his successor.

Following is a summary of the Red Flag Categories and Examples taken from the the Fair and Accurate Credit Transactions Act of 2003, Appendix J Section IIb and Supplement A to Appendix J. These will form the basis of our Compliance Management program.

Understanding this is necessary for developing an effective Red Flag Program for your automotive dealership. Yes it is very boring, so do not read while driving.

Categories of Red Flags:

I. Alerts, Notifications, or other warnings received from consumer reporting agencies or service providers, such as fraud detection services;

a. A fraud or active duty alert is included with a consumer report.

b. A consumer reporting agency provides a notice of credit freeze in response to a request for a consumer report.

c. A consumer reporting agency provides a notice of address discrepancy, as defined in 334.82(b) of the interagency guidelines.

d. A consumer report indicates a pattern of activity that is inconsistent with the history and usual pattern of activity of an applicant or customer, such as:

i. A recent and significant increase in the volume of inquiries;

ii. An unusual number of recently established credit relationships;

iii.A material change in the use of credit, especially with respect to recently established credit relationships;

iv. An account that was closed for cause or identified for abuse of account privileges by a financial institution or creditor.

II. The Presentation of Suspicious Documents

a. Documents provided for identification appear to have been altered or forged.

b. The photograph or physical description on the identification is not consistent with the appearance of the applicant or customer presenting the identification.

c. Other information on the identification is not consistent with information provided by the person opening a new covered account or customer presenting the identification.

d. Other information on the identification is not consistent with readily accessible information that is on file with the financial institution or creditor, such as a signature card or a recent check.

e. An application appears to have been altered or forged, or gives the appearance of having been destroyed and reassembled.

III. Suspicious Personal Identifying Information

a. Personal identifying information provided is inconsistent when compared against external information sources used by the financial institution or creditor. For example:

i. The address does not match any address in the consumer report; or

ii. The Social Security Number (SSN) has not been issued, or is listed on the Social Security Administration's Death Master File.

iii. Personal identifying information provided by the customer is not consistent with other personal identifying information provided by the customer. For example, there is a lack of correlation between the SSN range and date of birth.

b. Personal identifying information provided is associated with known fraudulent activity as indicated by internal or third-party sources used by the financial institution or creditor. For example:

i. The address on an application is the same as the address provided on a fraudulent application; or

ii. The phone number on an application is the same as the number provided on a fraudulent application.

c. Personal identifying information provided is of a type commonly associated with fraudulent activity as indicated by internal or third-party sources used by the financial institution or creditor. For example:

i. The address on an application is fictitious, a mail drop, or prison; or

ii. The phone number is invalid, or is associated with a pager or answering service.

d. The SSN provided is the same as that submitted by other persons opening an account or other customers.

e. The address or telephone number provided is the same as or similar to the account number or telephone number submitted by an unusually large number of other persons opening accounts or other customers.

f. The person opening the covered account or the customer fails to provide all required personal identifying information on an application or in response to notification that the application is incomplete.

g. Personal identifying information provided is not consistent with personal identifying information that is on file with the financial institution or creditor.

h. For financial institutions and creditors that use challenge questions, the person opening the covered account or the customer cannot provide authenticating information beyond that which generally would be available from a wallet or consumer report.

IV. Unusual Use of, or Suspicious Activity Related to, the Covered Account

a. Shortly following the notice of a change of address for a covered account, theinstitution or creditor receives a request for new, additional, or replacement cards or a cell phone, or for the addition of authorized users on the account.

b. A new revolving credit account is used in a manner commonly associated with known patterns of fraud patterns. For example:

i. The majority of available credit is used for cash advances or merchandise that is easily convertible to cash (e.g., electronics equipment or jewelry); or

ii. The customer fails to make the first payment or makes an initial payment but no subsequent payments.

c. A covered account is used in a manner that is not consistent with established patternsof activity on the account. There is, for example:

i. Nonpayment when there is no history of late or missed payments

ii. A material increase in the use of available credit;

iii. A material change in purchasing or spending patterns;

iv. A material change in electronic fund transfer patterns in connection with a deposit account.

v. A material change in telephone call patterns in connection with a cellular phone account.

d. A covered account that has been inactive for a reasonably lengthy period of time is used (taking into consideration the type of account, the expected pattern of usage and other relevant factors).

e. Mail sent to the customer is returned repeatedly as undeliverable although transactions continue to be conducted in connection with the customer's covered account.

f. The financial institution or creditor is notified that the customer is not receiving paper account statements.

g. The financial institution or creditor is notified of unauthorized charges or

transactions in connection with a customer's covered account.

VI. Notice from Customers, Victims of Identity Theft, Law Enforcement Authorities, or Other Persons Regarding Possible Identity Theft in Connection with Covered Accounts Held by the Financial Institution or Creditor

a. The financial institution or creditor is notified by a customer, a victim of identity theft, a law enforcement authority, or any other person that it has opened a fraudulent account for a person engaged in identity theft.

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