President Obama signed into law a bill that would prevent credit card companies from raising interest rates arbitrarily and charging certain fees.

During a bill-signing ceremony at the White House, President Obama praised the new law, which was the culmination of several years of work by consumer groups and Democrats to rein in what they say are abusive practices that prey on consumers.

“We’re not going to give people a free pass, and we expect consumers to live within their means and pay what they owe, but we also expect financial institutions to act with the same sense of responsibility that the American people aspire to in their own lives,” Obama said at a signing ceremony in the Rose Garden. Read more »

Visa Inc. has launched of the world’s first commercial Visa mobile payments service for point-of-sale transactions using Near Field Communications (NFC) technology.

The service marks the first time consumers can purchase an NFC-enabled mobile device off the shelf and use that device to make Visa payWave-enabled transactions at the point-of-sale instead of using their payment card.

The launch of Visa’s first commercial NFC program in Malaysia is based on Visa’s experience gained from undertaking extensive pilot activities around the globe and is something Visa plans to expand the service to other countries in coming years.
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Payments processor Heartland Payment Systems announced that hackers had used malicious software in its network in 2008 to steal up to 100 million credit and debit accounts.

In its announcement, Heartland Payment Systems, which processes payments for more than 250,000 merchants, said the company began receiving fraudulent activity reports late last year from MasterCard and Visa on cards that had all been used at merchants which rely on Heartland to process payments.

Heartland said that no merchant data or cardholder Social Security numbers, unencrypted personal identification numbers (PIN), addresses or telephone numbers were involved in the breach. Nor were any of Heartland’s check management systems; Canadian, payroll, campus solutions or micropayments operations; Give Something Back Network; or the recently acquired Network Services and Chockstone processing platforms. Read more »

Relief is on the way for millions of Americans who are furious with their credit card companies and who are having trouble keeping up with their credit card bills.

Federal regulators are adopting new rules for the credit card industry that aim to save consumers from arbitrary interest rate hikes and other unfair practices.
Among the changes, credit card companies will only be allowed to raise interest rates on new credit cards, future purchases or advances, not on existing balances.

Late fees could not be charged without giving consumers at least 21 days to make a payment.

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According to a recent report by Meredith Whitney, an analyst with Oppenheimer & Co., the Americas biggest credit-card lenders — Bank of America, Citigroup, JPMorgan Chase, American Express and Capital One — could cut as much as $2 trillion in consumer credit lines over the next 18 months.

Whitney said that the credit card market will be 18 months behind the mortgage market and will begin to shrink by mid-2010This will freeze money when credit is already tight and will hurt consumers — even those who are current on their bills — and their credit scores. Read more »

Eleven people, including a U.S. Secret Service informant, have been charged in Boston for stealing and selling some 40 million credit and debit card numbers they obtained by hacking into the computers of nine major US retailers, the US Justice Department said.

The scheme is believed to represent the largest hacking and identity theft case it has ever prosecuted by the Justice Department. The charges include conspiracy, computer intrusion, fraud and identity theft.

The stolen numbers were sold via the Internet to other criminals in the US and Eastern Europe and used to withdraw tens of thousands of dollars at a time from ATMs.

The eleven defendants include three US citizens, three from Ukraine, two from China, one from Belarus, one from Estonia and one whose place of origin is unknown, the department said in a statement. Read more »