I have a credit card with Union Bank. Or, used to, at any rate. At this point, I wouldn't do business with them on a bet with someone else's money. (Technically, I believe the credit card is from First Bankcard, which is a division of, or under contract to, Union Bank. In any event, the letterhead on the statements is from Union Bank.)

On April 30, 2010, they sent me a letter informing me of some changes to the terms of my account, including the interest rate. These changes were to take place on May 18, 2010.

On the first page of the letter, it says that "Any special, introductory or promotional offers or rates you may currently have will not be affected." (emphasis theirs).

To the best of my recollection, the entire balance on the card was from the use of promotional "checks," and in any event, was at 15.99%. This change should not have affected my balance.

The June statement arrived, the interest rate jumpted to 30.03%, or nearly double. I was not happy with this. I called their customer service number, and was put on hold several times before being told "this is the only interest rate we have available at this time."

Well, that's just not going to cut it. After doing a little research, I found the new rules explained in plain english on the Federal Reserve web site at:



There are several points of importance here:

1. As of February 22, 2010, credit card companies are required to give 45 days notice of changes to interest rates (among other things). Not 18 days.

2. The notice they sent did not, in fact, appear to apply to my balance.

3. They are not allowed to change interest rates on existing balances anyway.

This is according to the Board of Governors of the Federal Reserve System, the people whose job it is to enforce the rules that apply.

(When I pointed out on the phone that they had not sent the notice early enough, they lied and said there was no required minimum time.)