Released: October 05, 2007

Credit card fine print can cost you

Source: Selena Maranjian, Motley Fool

Every now and then, I read something that makes me gasp. It happened just recently, when I learned about a Public Citizen report on arbitration in the credit card industry. Here’s how it began: “Consumers who seek justice in disputes with their credit card companies shouldn’t expect to find it in binding mandatory arbitration (BMA); in cases decided in California by a major arbitration firm over a four-year period, consumers lost 95% of the time.” Yowza.

Now, arbitration sounds fair, doesn’t it? Here’s part of one definition I ran across online: “The hearing and determination of a dispute by an impartial referee agreed to by both parties (often used to settle disputes between labor and management).” See? Fair - an impartial referee.

But unless the vast majority of card holders with credit card issues are misguided, then something seems wrong. That 95% sure suggested a dirty little industry secret. And the more I read, the more it seemed that was the case. Check out this information from the report:

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