A Purchase Is A Purchase

According to BusinessWeek, the type of purchases one makes with a credit card can determine one’s credit score.

The FTC suit against Atlanta-based CompuCredit for allegedly “deceptive” marketing practices offers a rare look inside the opaque business of credit scoring. It reveals a mechanism that consumer advocates and politicians have long suspected exists—one in which purchasing behavior, not just payment history, matters.
The allegations, in part, focus on CompuCredit’s Aspire Visa, a subprime credit card for risky borrowers. The FTC claims that CompuCredit didn’t properly disclose that it monitored spending and cut credit lines if consumers used their cards at certain places. Among them: tire and retreading shops, massage parlors, bars, billiard halls, and marriage counseling offices. “The company touted that cardholders could use their credit cards anywhere,” says J. Reilly Dolan, assistant director for financial practices at the FTC. “What they didn’t say was that you could be punished for specific kinds of purchases.”

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About David Burn

Native Nebraskan in the Pacific Northwest. Brand builder at Bonehook. Co-founder and editor of AdPulp. Contributor to The Content Strategist. Believer in Gossage, Bernbach and Clow. Doer of the things written about herein.

  • http://www.retread.org Harvey Brodsky

    I am writing to comment on the article on the home page of BUSINESS WEEK ON LINE today.
    During my more than 30 years in the retread industry I have read and heard some crazy things about retreading, but the mention of retreads in the paragraph
    “The allegations, in part, focus on CompuCredit’s Aspire Visa, a subprime credit card for risky borrowers. The FTC claims that CompuCredit didn’t properly disclose that it monitored spending and cut credit lines if consumers used their cards at certain places. Among them: tire and retreading shops, (emphasis mine) massage parlors, bars, billiard halls, and marriage counseling offices. “The company touted that cardholders could use their credit cards anywhere,” says J. Reilly Dolan, assistant director for financial practices at the FTC. “What they didn’t say was that you could be punished for specific kinds of purchases.” The Federal Deposit Insurance Corp. is also seeking $200 million in penalties from CompuCredit in the matter.”
    absolutely tops the list.
    This would be funny if it weren’t so serious. How dare CompuCredit malign an honorable industry, especially one that not only saves motorists money, but also is one of the most environmentally friendly of ALL industries!
    I certainly hope that the Federal Deposit Insurance Corporation gets the $200 million in penalties from CompuCredit. It will serve them right, and maybe if they have to lay off some of their staff as a result, those poor folks will have to resort to buying retreads for their vehicles as a way to save money.
    You know what? They will be glad they did.
    (I am sending a copy of this email to my Board of Directors and others in our industry who may have a thing or two to say to the folks at CompuCredit.)
    Sincerely,
    Harvey Brodsky
    Managing Director (I drive on retreads!)
    Tire Retread & Repair Information Bureau/TRIB
    900 Weldon Grove
    Pacific Grove, CA 93950 USA
    Toll free from anywhere in North America 888-473-8732
    Telephone: 831-372-1917, Fax 831-372-9210
    Cell 831-917-6449
    E-mail: info@retread.org
    http://www.retread.org – A GREAT SITE TO BOOKMARK AND REVISIT OFTEN!
    The retread industry is one of the GREENEST industries in the world! Go retreads…GO GREEN!