For over 7 years, I was a satisfied customer of First USA and they were very responsive to any problems that arose. However, since December 1999, I have been trying to notify First USA of the fact that they have been overcharging interest on my account. Since I have a large balance, the overcharge ranges from about $20-over $50 from month to month. All of this began between Oct-Nov 1999.
For the last 7 or 8 years, I have had a fixed "graduated interest rate" of 11.9% on the first $2500, 10.9% on the second $2500 and 9.9% on anything above $5,000. This was clearly a very good deal and I used my card frequently with no problems. By November 1999, I noticed an increase in the interest charged. Because of this and the recent change in interest from what had averaged 10.5% to 13.44% in July 2000, I have 3 separate complaints and no information on what agency might be in charge of resolving this. First USA sends responses to my letters, but the responses simply ignore the complaint and limit themselves to providing information.
First complaint, in November 1999 when I checked the annual and corresponding daily periodic rates (the latter used to calculate the actual monthly interest amount), I found a clear and unequivocal error--the daily rates for the no longer corresponded to the annual rate. For instance, the daily rate for 9.9% is .02712 and for 10.9% is .02986. I confirmed this with past statements for 1997 and 1998 and most of 1999. Now the daily rates for both 10.9% and 9.9% appear as .03260 and have continued this way until July 2000, when First USA eliminated the graduated interest rate and established a single rate. At the same time, the total annual percentage rate column began to fluctuate widely from the average of 10.42% that usually showed up (after all, it varies according to the total amount owed) to rates between 11.18% and 12.57%. Because I owe significantly more than $5,000, this clearly should not be. In fact, one month the yearly average cited was more than even the highest rate charged on the first $2500!
Second complaint. In November 1999, the highest corresponding annual percentage rate (which always had been 11.9% for the first $2500), suddenly began to vary from month to month. It ranged from the 11.9% I signed on for to 12.4% and 12.65%. I received no notice or explanation the several times I called. By mail, I was simply told the rate for the first $2500 was 12.4% with no explanation as to how the decision was made to increase it or the legality of the move.
Third complaint. In late June 2000, I received a notification that as of July 1, the rate would increase to 13.44% and there would be one, non graduated rate to apply to the entire balance. The way in which the notification was sent out and questions regarding the legality of this move are what prompt my third complaint. Can they do this? Is there no way to stop them? Also, the notification stated that use of the card would indicate acceptance and that to maintain the past interest agreement required non use of the card and immediate elimination of automatic billing to the card. I stopped using the card, but since the notification arrived after I had recently used the card, the interest went up to 13.44% on my most recent statement which, of course, showed the charges made before the notification was received.
I am now in the process of looking for another credit card to which I can transfer my balance for a significantly lower interest rate. However, I am very interested in having the overcharged interest credited to my account and am very interested in having First USA investigated. I cannot be the only customer who was overcharged. Even if everyone of their 20 million or so customers was overcharged by only $1.00 a month, that represents $20 million a month in pure greed for First USA--in violation of all of our contracts.
One final note. The evidence is there on the statements. We are provided with a table that shows the range of balances, average daily balance subject to finance charge, daily periodic rate, corresponding annual percentage rate, and annual percentage rate (averaged for that particular month). It is very simple to calculate the number of days in the cycle by usign the daily periodic rate and the total finance charge for that month. Then, once you know the number of days, it is a simple matter to use the average daily balance subject to finance charge and the correct daily periodic rate to calculate the correct interest amount that should have been charged. They foolishly and blatantly provide the evidence for us of their mismanagement.
I would be most interested in joining a class action suit against this company.