Tuesday, 24 March 2009

More crazy credit-card terms and conditions: Capital One

After getting notices of outrageous new terms and conditions from American Express and Bank of America and hearing about similar new terms for Paypal credit cards (see the comments) issued by GE Money Bank, I requested copies of the current terms and conditions for all of my current cards.

I just got the following from Capital One. It took three requests, as they kept sending me summaries or ancillary documents rather than the actual “customer agreement”. I’m not sure when these terms were imposed, but any notice probably slipped by me in the fine print with one of my previous bills:


We may contact you from time to time regarding your Account. We may contact you in any manner we choose unless the law says that we cannot. For example, we may:

(1) contact you by mail, telephone, e-mail, fax, recorded message, text message or personal visit;

(2) contact your home and at your place of employment;

(2) contact you on your mobile telephone;

(4) contact you at any time, including weekends and holidays;

(5) contact you with any frequency;

(6) leave messages on your answering machine/service and with others; and

(7) identify ourselves, your relationship with us and our purposes for contacting you even if others might hear or read it.

Our contacts with you about your Account are not unsolicited and might result from information we obtain from you or others. We may monitor or record any conversation with you, modify our caller ID and use automated dialing and announcing devices (autodialers).

We may do these things whether we call you or you call us.

This goes further than any other card issuer’s terms I’ve seen.

Why would they want to pay me a “personal visit” (“with any frequency” and “at any time”) at my home or place of employment? If they knock on my door in the middle of the night, do I have to let them in? Have I already waived my right to call the police to make them go away? Why would I give any financial institution permission to “identify your relationship with us … even if others might hear”, or to spoof their caller ID?

And if their real purpose is to preemptively ensure their ability to harass deadbeats enough to get them pay their unsecured credit card debts, doesn’t all this directly violate the Fair Debt Collection Practices Act ? Does such a unilaterally-imposed and non-negotiable “agreement” really trump the limits on collection practices in the FDCPA? And would the arbitration clause in the “agreement” apply to private actions (other than in small claims court) to collect damages under the FDCPA? Comments from my legal readers would be welcome.

Link | Posted by Edward on Tuesday, 24 March 2009, 09:22 ( 9:22 AM)

On the subject of credit card collection practices, I hope you will get a kick out of the letter I recently received. It's amazing how hard they will work to collect a zero balance. This is taxpayer bail-out money put to good use:

Cardmember Service
P.O. Box 15548
Wilmington, DE 19886-5548

March 11, 2009

RE: Your account ending in ...

Dear ...

We have been trying to contact you for some time now to discuss this account's outstanding balance of $0.00. As the Authorized Officer or the person responsible for this account, you are personally obligated for the outstanding balance on the account. Please contact us to make payment arrangements.

Please call us immediately a 1-888-549-6881 to discuss this account. You may qualify for one of our flexible payment programs. If you are not the person responsible for payment, please contcat us so that we may update our records.


Customer Support Division

Account is owned by Chase Bank USA, N.A.

Calls may be monitored and/or recorded to ensure the highest level of quality service.

[Note: I received a copy of the actual letter, but was unable to generate a legibly redacted image. I have transcribed it in its entirety, except for the account details.-- EH]

Posted by: Phil Olsen, 24 March 2009, 14:54 ( 2:54 PM)

One lawyer sent me the following:

"Under the FDCPA, a debt collector is someone who regularly collects debts owed to others. This includes collection agencies, lawyers who collect debts on a regular basis, and companies that buy delinquent debts and then try to collect them.

So, an entity collecting its own debts is not covered. I have no idea if there are any other statutes protecting against harassment by credit card companies directly. But, the statute you linked to does not cover it."

However, other parts of the "agreement", which I didn't quote, (purport to) grant Capital One the right to assign any or all of its rights under the agreement to any third party, without the consent of the cardholder. And they define us" as including agents, representatives, and assignees. So I think it the FDCPA is relevant to the actions of debt collectors, who would presumably be acting as assignees.

The same lawyer also comments:

"The bottom line is that with respect to consumer protection legislation, the protections cannot be waived by the consent of the consumer. So, if the consumer signs an agreement saying it's ok to harass me, have your debt collector call me at midnight, the protection law takes precedence over the contractual provision. I think that is pretty clear legally."

If correct, that's certainly a good thing. But if these provisions are invalid or unenforceable in the face of other consumer protection laws, why are the card issuers imposing them?

Posted by: Edward Hasbrouck, 24 March 2009, 15:02 ( 3:02 PM)

"Capital One Has Company: ‘Personal Visit" Clause Is Nothing New And Not All That Rare" (by Christopher Zara, International Business Times, 18 February 2014):


Posted by: Edward Hasbrouck, 16 March 2014, 14:32 ( 2:32 PM)
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