Federal Judge Rules Against Credit Card Fee - Other News

ADVERTISING DISCLOSURE

ADVERTISING DISCLOSURE:
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Federal Judge Rules Against Credit Card Fee

Federal Judge Rules Against Credit Card Fee

Federal Judge Rules Against Credit Card Fee
The content is accurate at the time of publication and is subject to change.

First Premier Bank and Premier Bankcard have emerged victorious from their first round of lawsuits against the federal government. This, with a preliminary injunction preventing a new provision of 2009’s Credit Card Accountability and Responsibility and Disclosure Act from going into effect. U.S. District Judge Karen Schreier signed the ruling.

“First Premier has sufficiently demonstrated that it is ‘likely’ to succeed on the merits of its claim because the board acted in excess of its statutory authority,” wrote Schreier according to the Argus Leader.

Marketed to specifically to consumers with poor credit, Premier Bankcard has been struggling since last year when the Credit Card Accountability, Responsibility and Disclosure Act went fully into effect. Because the new regulations restrict the card issuer’s ability to charge customers according to their level of risk, they have found it difficult to bring in new business and have been forced, as a result, to reduce their work force.

Over this past summer, Premier Bankcard and First Premier Bank cut their workforce in half, from 3,000 employees to 1,500, when they shut down their Spearfish location.

According to president of the South Dakota Bankers Association, Curt Everson, the preliminary injunction is a good thing for both South Dakota and the economy as a whole.

“They are a large employer, a good employer, pay good wages, provide good benefits and have proven to be a good community supporter. It hurt the Spearfish community when they had to close down their facility,” said Everson according to Argus Leader.

Court transcripts reveal that Premier made the case that, should the preliminary injunction not be granted, it would suffer “irreparable harm” that would lead to a further reduction in its work force and considerable shut-down costs.

The losses Premier predicted amounted to some $1.2 million per month if the amendment were to go into effect. This number is based upon the assumption of a typical account remaining open for the duration of 24 months.

The amendment, slated to go into effect on this October 1, would have limited the amount a company could charge a new cardholder prior to issuing them a card to only 25% of the line of credit.

“I think if they can’t get clarity on a product they can offer into the subprime market, clearly their business has to shrink,” said Curt Everson, president of the South Dakota Bankers Association, as reported by Argus Leader.

“That would be a real adverse impact on the state economy and not only impact them, but other subprime lenders in our state.”

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

New Travel Benefits for Mastercard World and World Elite Cardholders

Posted: October 18, 2018

Mastercard has upped the ante when it comes to travel for Mastercard World and World Elite cardholders by adding two new benefits into the mix. Now cardholders get access to Mastercard’s Hotel Stay Guarantee and Lowest Hotel Rate ... Continue reading
Paying Bills is Getting Easier with Mastercard Bill Pay Exchange

Posted: October 17, 2018

MasterCard is looking to help consumers pay their bills more easily and quickly with Bill Pay Exchange, a new digital solution they are launching. The Bill Pay Exchange will let people manage and pay all sorts of monthly bills ranging from ... Continue reading
Synchrony and JCPenney Are Still Partners

Posted: October 16, 2018

Synchrony and JCPenney have inked a multi-year deal extending their strategic partnership, which includes their private label credit card program and the JCPenney MasterCard. This extension means that the two will continue to work together ... Continue reading
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com, or wholesale clubs up to the quarterly maximum each time you activate.
For Excellent, Good Credit
INTRO OFFER: Discover will match ALL the Miles you've earned at the end of your first year, automatically. For example, if you earn 30,000 Miles, you get 60,000 Miles. That's $600 towards travel!
For Excellent, Good Credit
Earn 2% cash back on purchases: 1% when you buy plus 1% as you pay
For Excellent, Good Credit
You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!