Tuesday, June 18, 2024

Capital One, and other, banks’ tactics that might shock you
by Scott Bilker
Scott Bilker is the author of the best-selling books, Talk Your Way Out of Credit Card Debt, Credit Card and Debt Management, and How to be more Credit Card and Debt Smart. He's also the founder of DebtSmart.com. More about and DebtSmart can be found in the online media kit.

Scott Bilker

This article is aimed at Capital One because I have a great inside source who has been working as a customer representative for a while now. He recently sent me an email outlining many tactics that Capital One is using when you call in. However, this has come to the forefront because many banks have been closing accounts and reducing credit limits of even their best customers. I've had maybe a dozen accounts closed so far myself, including a  Capital One account. I called the bank to try and keep the account open and, for the most part, the banks are not agreeing. They tell me that, "these decisions are in response to the current credit crisis." Gee, I'm thinking that, "huh, the banks blew it (to the tune of $300 billion) because of bad decision making and now, their next move is to close the accounts of their profitable, and potentially profitable customers." Yeah, that's a good move--duh! What are they thinking! Talk about cutting your nose off.

Citibank recently closed my business account for inactivity. INACTIVITY! Last I checked, I just bought two sets of plane tickets the month before. Okay, prior to that I only used the card in January and November in 2008, but hold on. From 1999 through 2007, I used the card every month. EVERY MONTH! What are these fools thinking? So you know what? (and I DON'T recommend doing this) I closed ALL my Citibank accounts. The funny thing is when I called to close my personal accounts they tried to stop me. The rep from the personal side called the business side and tried to stop them from closing the account. He couldn't stop them. Stupid Citibank. I don't recommend  closing all your accounts because it may hurt your credit score. BUT, in this case, for me, I want to teach them a lesson. That lesson is that I'm not using them, and I'll take my chances with my credit score (I'll let you know what happens).

Okay, back to Capital One. The below email details their tactics to deal with customers who call in about their accounts being closed. Also, and most importantly, my source explains exactly what you need to say to get out paying some fees. This is great information. Enjoy!

Here's the inside scoop...


Scott, In response to what I had mentioned earlier about what Capital One is doing to their customers...

On December 8, 2008, Capital One decided to suspend 1.4 million inactive accounts (up to a year of no activity) for 60 days, and they close the accounts after that suspension period. Capital One never sent any letters warning the customers to use their card before this irreversible action would take place. That's why every single person that calls in about this I have to apologize to when they ask, "Why didn't Capital One forewarn me?"

Capital One DID take the time to send out letters saying their accounts have been suspended though. Also in the scripts I have to read to customers in response to this IS not a good answer at all. It's just apologetic and I quote, "I'm sorry to hear this upsets you....Would you like me to redeem any rewards points before the suspension period ends?" There is NO legitimate or factual reasons provided for me to give to the angry cardholder, which just infuriates them even more, about why Capital One made this decision.

And ONLY if the cardholder inquires about their credit being affected am I able to talk about the topic, "If you choose to close the account, it will be reported to the credit bureaus as closed by consumer. And if you let us close the account it will show in the credit reports as closed by grantor." Of course it's better to be shown that it was closed by consumer but THEY DON'T WANT THEIR ACCOUNTS CLOSED IN THE FIRST PLACE!

And then it is suggested that we tell them they can reapply with us. And I always get the answer (of course), "Why? So my credit can get pulled again?!" People are pissed about that...and the reason for their non-usage of the account is to have the cards for emergencies--I feel really bad for the customers.

A loophole to get out of past due fees and/or overlimit and finance charges is (and I know you know all this stuff, but I'll state it just in case)...

Let's say in reality you can't make a payment for one month because you don't have the funds. The result would be you would assess fees, even if you called and asked to have them waived, because it's not convenient for you this month, Capital One would of course say "no" unless you had a legitimate excuse (and you can lie of course, because we never request proof of the fact unless you are part of a third party "payment protection program." If you lie and say you are going through one of the following hardships we can waive up to two months worth of fees (we have to accept our customers requests as truths).

1) Complicated pregnancy.
2) Unemployment.
3) Hospitalization (if you want more than two months waived, THEN you would have to send proof through fax of how long your stay was.
4) Divorce is NOT on there (and I think it really should be).

Three other non-hardship ways to get fees waived are:

1) Say you never received your paper statement in the mail (and make sure you don't have online banking set up because then we won't honor your claim....we can see if you have that web access on your profile) We would also do a "reprice reversal" and fix your APR back to what it was before "you hadn't received the statement".
2) Everyone qualifies to have a membership fee waived at least once "if you call in and ask."
3) Ask if you can receive a goodwill credit (which can be up to $60) if you say you got poor customer service and/or "are upset and irate and ask during your fit of madness."

Reader Comments
" Great info Scott, as always! I featured this article on my blog. I am hearing so many complaints like this. A few years ago, I shared the platform with a speaker named Bill Hillestad. He warned that if credit dried up in America the Great Depression would look like a picnic."
--Gerri Detweiler
" I'm going through the same thing with store credit cards I have been paying on time every month and above minimum. Sears and Old Navy--they reduced my credit limit and state they'll reevaluate me in 3 months--you know I won't be using their cards again. Now I know I'm not the only one. Thanks"
--Janine Brewton
" I like Scott's opinions...I usually agree with him. I particularly liked his getting mad at the situation Citi put him in because I can totally relate. Frustration! All of my creditors have closed ALL of my credit card accounts. I have decided to make a sea change in my family's lifestyle. If we can't pay cash, we will do without. Screw the banks and their opiate credit."
--Tom Foster
" Bank of America did the same thing to me. Closed an account with no balance and cut my limit on my other card to my balance raised my interest rate and now I cannot pay the minimum and they don't care. They will not do anything to work with me. I have tried transferring to other cards and have been turned down. My excellent credit score is about to go down the drain because of them and it doesn't seem like there is anything I can do about it. BofA let me transfer 2 balances from other cards to make my current balance and then tell me I don't make enough money to pay it but raise my interest so the minimum is more and won't let me use the card anymore. Why did they let me transfer to this card to begin with. They suck!!!!!"
" It just goes to show how greed clouds up the thinking process at the Credit Card companies."
" It shows that I am not the only one being affected. It also shows how stupid the banks are."
--Rush Kittle
" Highly informative and lets us know what is going on behind the scenes. Gave ammunition for the future. You always seem to pull that Ace out of your sleeve when the economy needs it most. Hats off to you, another great job!!!!!"
" Hi Scott...John from the Twin Cities! Terrific article! I can definitely relate. Been there, done that, got the t-shirt, went home! I definitely agree that what Citi did to you, me, and many other cardholders is going to come back to bite them in the butt! But one question: did you ask the Citi customer service rep that was helping you if you could transfer the credit line on the closed accounts over to one of your active accounts? (that was before you closed all of your Citi Card accounts) I did that with a Citi MasterCard pending closure and the rep transferred the credit line to an active account."
John Phillips
" Great article. Chase did the same to me. I was going to close the account, but they told me to lower the credit limit to $1000.00. So I did, not to effect my credit score, then they closed the account."
Bernard Gray

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