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Dodd Frank legislation created federal agency monitoring 75% of our credit card transactions

Excuse my blunt question. Why the hell does some federal government agency need to monitor and track the use of my credit card?

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Democrats and Obama crush financial options for low-income families

In November, I wrote about how the payday loan industry is being regulated out of business as government know-it-alls determined they were bad for consumers. Regulating the industry took an option away from consumers in need, but as it turns out, the Dodd-Frank credit card reform legislation – effecting more traditional financial institutions – makes it even worse for those who need a few dollars.

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Obama on the evils of credit cards

We used to say the company that gets a union deserves a union. On Friday the President outlined the reasons behind the new credit card legislation and I can’t say that I disagree with many of the things he says here … whacking people who pay on time with higher rates to boost profits may be legal but clearly … knowing the Democrats were in charge … likely not smart … leading to tougher rules. It is pretty outrageous on the part of the banks.

httpv://www.youtube.com/watch?v=9R4FSryS92Y

But there’s an easy solution and that’s putting away the cards and telling the banks to take a hike. That though, is not going to happen … so the Feds ride to the rescue and the banks get what they deserve and what they should have expected. More regulation.

The banks says they will retaliate by eliminating rewards and charging fees to their most credit worthy customers and offer feweer cards to less credit worthy.

I say fine. My guess is the market will step in an offer some competition and the banks will continue to push cards on … welll everyone and the dog. What do you think? Take the poll.

And as an aside … notice how Obama introduces Senators Dodd and Shelby … using the phrase “partner in crime”. Ha!

httpvd://www.youtube.com/watch?v=9R4FSryS92Y

Expect new credit card fees now that Obama is involved

The Obama administration and many in Congress – including our good friend Sen. Chris Dodd (D-Conn.) – are pretty disgusted at the contracts that are in place between credit lenders and credit card holders. The exorbitant fees and interest rates are just too much, and the federal government is planning regulatory legislation to stomp out the mean big-business practice.

In short, people who were provided credit they should not have received can not pay their bills right now due to the economy., so therefore, stop the banks from making any profit from those people. The issue is that the banks need to make a profit, so if the government steps in, the banks will need to find other sources of income.

What you’ll see happen is banks refusing to provide credit cards to those with lower credit scores and they will probably reduce benefits (cash back, airline awards, points…) and bring back or increase yearly fees.

The government will not refer this new banking practice as a “loophole” that must be closed since it is designed to “screw the rich.”

Hot Air has more and a poll up. This again is one of those situations where if you do the right thing on a month-to-month basis, you’re going to have to pay more in the future.

If you pay off your bill monthly, you must be rich and can afford to pay more. If you don’t pay your bills, spend more than you can afford, the government will come in to squeeze banks into giving you a better deal. If the banks do not do the bidding of Congress and the Executive branch, they will get crushed by those in power.

So for those of you who pay your monthly credit card bills on time and within the grace period, how do you feel about this? My emphasis in bold.

Banks are expected to look at reviving annual fees, curtailing cash-back and other rewards programs and charging interest immediately on a purchase instead of allowing a grace period of weeks, according to bank officials and trade groups.

I use a credit card for convienence, and I’m known for accepting new cards if I can get free money over time, but I play the game correctly and pay it off so I pay zero interest. Provide me with a better deal and I’ll pay cash every time.

Houston drops idea to pay off personal debt

A proposal to hand out $3,000 to individuals who did not have  good enough credit score to qualify for mortgages has been crossed off the Houston city council agenda this week.

The idea was to use the $3,000 to help individuals improve their credit score by a few points so they would qualify to buy a home.

Of course, it really does not matter that these individuals should not be buying a home in the first place.

The mayor got a bit embarrassed by all of the news coverage on Web sites like Drudge Report and nixed the idea before it got to council. You can bet if liberals were able to do this on the sly, it would have gone through and taxpayers would be paying off credit card debts and car loans for folks with crappy credit scores so they can buy a house that they can not afford.

From the Houston Chronicle

Mayor Bill White this afternoon announced that a plan for the city to pay off some debts for first-time home buyers has been pulled from tomorrow’s City Council agenda.

Council members are now professing their “embarrassment” about the proposal, which has hit the national news circuit, including drudgereport.com., which picked up this morning’s Houston Chronicle story about the plan

“This issue has hit a nerve across this country,” said Councilwoman Anne Clutterbuck. “Not just here in the city of Houston. Giving people the ability to increase their credit score artificially because we’re allowing them to pay off their credit cards is exactly what got us into this (national economic) crisis in the first place.”

No kidding?

Testing McCain and Obama web sites – credit card fraud

After all of the activity concerning the Obama Web site and how it seems a bit “loose” in how it collects credit card donations, I’m taking one for the team and testing it myself.

Author note: While I’m away from the computer, I’m republishing my top 20 posts from 2008 each afternoon. -Steve (by the way, Obama still has my 10 bucks)

But instead of just testing Obama’s site, I’m testing the McCain site too. Note that neither of the sites ask for the credit card validation number – also know as the CVC – which is normal practice by other secure Web sites that collect credit card information for processing.

Updates at the bottom of this post…

My first step was to go to the McCain site and make a donation. Click on the image to see the full size. I’ve redacted my personal information.

After submitting at the McCain site, I was directed to the following page. It shows that there is something wrong with my form and asks me to check the information. Note that the credit card data field is now blank, but there is no specific indicator showing which field is throwing the error. Click on the image to see the full size.

Next step, head over to the Obama site and see what the user interaction is with the form using the exact same personal information. Here is the form, click on the image for the full view.

After hitting submit, the transaction seems to go through and I get the following thank you page.

Next, I headed over to my online bank account to check my card for activity. As of this moment, it looks like both Obama and McCain have a pending charge posted to my card.

I will keep readers updated if the “pending” status changes for either of the charges. I’m not impressed that McCain’s site showed an error but still seems to have posted the pending charge.

Keep in mind that for small amounts – usually under $25 – credit card companies don’t care as much about authorizations or signatures. Note that within the past year, when I buy lunch using my card my signature is no longer required.

Either way, both campaign sites have crappy authentication system for donations.

Other blogs on the story include Vicevich (Radio Vice Online), MalkinLGF and Powerline. Whoops – of courseHot Air is on it too.

Update: Got an e-mail from the Obama campaign with a thank you note. Guess that car magnet will get “lost in the mail” since the address does not exist. After more than an hour, no e-mail from McCain campaign.

Update (2:11 p.m. ET): Credit card online account is now listing the McCain transaction (Edonation 1) as zero dollars. Also both Obama and McCain listed as pending. Note that a Radio Vice Online listener confirmed to me that McCain donations show up as Edonation 1on statements.

Update (Oct. 25, 7:40 a.m. ET): Overnight, I realized that I used my correct credit card expiration date. If you feel like testing the Obama site yourself, try it with an invalid expiration date. Also, checked the online statement this morning. The pending transaction for Edonation 1 (McCain) is now totally gone.

Update: (Oct. 25) Allah’s on it at Hot Air. Gaining traction. Question for the Obama campaign… How many donations under $200 did they reject? My $10 transaction is still listed as pending, but once it does go final – what’s the chance that they will refund the credit card account when they realize it’s all fake information? They probably will see this post and refund it.

Update: (Oct. 27) Lots of others testing the system. My transaction still listed as pending as of this morning.

Update: (Oct. 28) Obama now officially has my 10 bucks.

Mainstream media catching on to illegal Obama donations

Web site transaction security stuff has been standard operating procedures for years at just about every e-commerce site in business – except for the Obama campaign donation site. Late last week I tested both the McCain and Obama sites by trying to send $10 to each campaign using a real credit card number and expiration date, but everything else was fake.

Author note: While I’m away from the computer, I’m republishing my top 20 posts from 2008 each afternoon. -Steve

Today, the Washington Post is catching on.

After prodding from myselfVicevichPowerlineLGFHot AirMalkin and many others, the Washington Post has picked up the story in Obama Accepting Untraceable Donations.

Sen. Barack Obama’s presidential campaign is allowing donors to use largely untraceable prepaid credit cards that could potentially be used to evade limits on how much an individual is legally allowed to give or to mask a contributor’s identity, campaign officials confirmed. …

In recent weeks, questionable contributions have created headaches for Obama’s accounting team as it has tried to explain why campaign finance filings have included itemized donations from individuals using fake names, such as Es Esh or Doodad Pro. Those revelations prompted conservative bloggers to further test Obama’s finance vetting by giving money using the kind of prepaid cards that can be bought at a drugstore and cannot be traced to a donor. …

The problem with such cards, campaign finance lawyers said, is that they make it impossible to tell whether foreign nationals, donors who have exceeded the limits, government contractors or others who are barred from giving to a federal campaign are making contributions.

This is good reporting concerning the prepaid credit cards that are untraceable, but it still does not cover all of the problems with the Obama system.

If they simply put in the same security measures that the McCain site has, most of the problem donations could have been completely avoided. McCain is not asking for a CVC number, but they do have other security checks in place. (I proved it)

Obama’s site is not doing any of the following.

  • Requiring a CVC number with every transaction.
  • Requiring that the last name on the card matches the last name on the Web donation form.
  • Requiring that the zip code for the cards billing address matches the zip code on the Web donation form.

Next, Obama’s camp is going to complain that donations were coming in so fast, that they had to turn off the security checks to keep the site from crashing or being too slow. Bull.

Maybe if Obama had kept his promise to only stick with public financing, he would not have any issues.

The CNN anchor [Campbell Brown] then reminded her viewers of Obama’s public financing promise: “One year ago, he made a promise. He pledged to accept public financing, to work with the Republican nominee to ensure that they both operated within those limits. And then it became clear to Senator Obama and his campaign that he was going to be able to raise on his own far more cash than he would get with public financing. So, Obama went back on his word. He broke his promise…”

Mainstream media catching on to illegal Obama donations

Web site transaction security stuff has been standard operating procedures for years at just about every e-commerce site in business – except for the Obama campaign donation site. Late last week I tested both the McCain and Obama sites by trying to send $10 to each campaign using a real credit card number and expiration date, but everything else was fake.

Today, the Washington Post is catching on.

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Updated: Testing McCain and Obama web sites – credit card fraud

After all of the activity concerning the Obama Web site and how it seems a bit “loose” in how it collects credit card donations, I’m taking one for the team and testing it myself.

But instead of just testing Obama’s site, I’m testing the McCain site too. Note that neither of the sites ask for the credit card validation number – also know as the CVC – which is normal practice by other secure Web sites that collect credit card information for processing.

Read more

If You Can’t Afford It…

The Hartford Courant – along with a bunch of other MSM outlets – released an AP news story detailing how more and more people are falling behind on their credit card debt.

The value of credit card accounts at least 30 days late jumped 26 percent to $17.3 billion in October from a year earlier at 17 large credit card trusts examined by the AP. That represented more than 4 percent of the total outstanding principal balances owed to the trusts on credit cards that were issued by banks such as Bank of America and Capital One and for retailers like Home Depot and Wal-Mart.

At the same time, defaults — when lenders essentially give up hope of ever being repaid and write off the debt — rose 18 percent to almost $961 million in October from a year ago, according to filings made by the trusts with the Securities and Exchange Commission.

Serious delinquencies also are up sharply: Some of the nation’s biggest lenders — including Advanta, GE Money Bank and HSBC — reported increases of 50 percent or more in the value of accounts that were at least 90 days delinquent when compared with the same period a year ago.

Of course…

Experts say these signs of the deterioration of finances of many households are partly a byproduct of the subprime mortgage crisis and could spell more trouble ahead for an already sputtering economy.

Yeah right. Now that the people – who were not smart enough to realize what an ADJUSTABLE rate mortgage is – got the government to force banks to cut them a break, they figure now is the time to start complaining about the high interest and payments that they have on their credit card debt.

Borrowing words from James Tolkan’s character Stinger in Top Gun, “Son, your ego is writing checks your body can’t cash.”

And as Michelle Malkin has stated.

Suck. It. Up.

Right on. Maybe these folks should just stop spending money that they don’t have.  All indicators tell us there will be a federal bailout coming to cover the credit card payment crisis that is most certainly around the corner. Start spending now!