MBNA America Credit Card - Arbitration Warning to Consumers Who Usa a MBNA America Credit Card ripoff Nationwide

I am posting to inform everyone of your loss of rights under Binding Mandatory Arbitration or BMA clauses and how credit card companies use this to their advantage to exploit and rip you off. The card companies do this in the form of late fees, over limit fees, continous interest rate increases, default interest rate pricing, and other changes to your account terms so they can steal your money and not be held accountable and thus give you, the cardholder/consumer no legal recourse to sue them in court for their behavior, lies and misrepresentations.

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Binding Mandatory Arbitration Clauses (called BMA clauses) aren't designed to help you or save you moneythey are designed to hurt you.

BMA clauses strip you of your rights. They are virtually always written to help the other partynot you.

BMA clauses are so bad that few consumers try to use them to solve a dispute. Instead, the consumer walks away from the disputeeven when the consumer has been terribly hurt. One study shows that in 50,000 arbitrations, consumers brought only fifty of those arbitrations. Companies brought the rest.

Most credit cards issued by national banks have BMA clauses. If your credit card has a BMA clause, transfer your balances to cards without these clauses and consider closing your account with the offending companies. Send a letter, such as the one below, explaining why when you close your account.

Should you close your credit card accounts with BMA Clauses?
One of the most powerful tools consumers have is their pocketbook. If you have more than one credit card, why not move your balances to the credit card without a BMA clause and support the business that treats you fairly?

Here's the plan:
1. Make sure you have a credit card without a BMA clause. If you have a credit card from AARP, you are setAARP credit cards don't have BMA clauses. If you have a credit card from a credit union, you are probably okay. Most credit unions do not have BMA clauses. Some small banks don't have BMA clauses, either.

2. Make sure the interest rate on your good credit card is as low or lower than the interest rate on your bad card.

3. Contact your good credit card company, and make sure they will approve transferring your balance from the bad card to their card.

4. Then send the following letter to your bad credit card company.

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Dear (name of business): __________________________________ Date: __________
Unless this account is not covered by any binding arbitration agreement, please close my account number (insert account number): _________________________________
I want my right to go to court if we have a dispute. Our tax dollars have already paid for a justice system and mandatory binding arbitration is unnecessary. Thank you.

Signed: ____________________________________

Name: ____________________________________
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Binding Mandatory Arbitration Frequently Asked Questions

What is arbitration?
Arbitration is an alternative method of resolving disputes in which two parties present their individual sides of a complaint to an arbitrator or panel of arbitrators. The arbitrator, who is supposed to be neutral, then weighs the facts and arguments of both parties and decides the dispute. Arbitration may be voluntary or mandatory.

What is voluntary arbitration?
In voluntary arbitration, both sides in the dispute voluntarily agree to submit their disagreement to arbitration after it arises and after they have an opportunity to investigate their best options for resolving their claim.

What is binding mandatory arbitration?
In binding mandatory arbitration, a company requires a consumer to agree to submit any dispute that may arise to binding arbitration prior to completing a transaction with the company. The consumer is required to waive their right to sue, to participate in a class action lawsuit, or to appeal.

Are these clauses easy to find in the paperwork?
Generally not! Some companies print them in boxes, and a few have you sign a separate sheet of paper which contains the clause. But many companies simply make the clauses an extra paragraph of fine print in their contracts.

Is Binding Mandatory Arbitration always the name of the clause?
Definitely not! Some companies call these clauses Dispute Resolution Mechanism and other equally hard-to-understand names.

What's wrong with arbitration?
Nothing, if its voluntary arbitration! In fact, voluntary arbitration can be a great thing in preventing lawsuits and alleviating backlogs in the judicial system. In fact, you always have the right to arbitrate. But you never want to give away the right to sue if arbitration does not work. Companies want you to give away that right.

Do companies use binding mandatory arbitration in their own disputes with other companies?
No, most refuse to use binding mandatory arbitration in their own business dealings. As a matter of fact, car dealers were so afraid of mandatory arbitration for their own disagreements that they spent millions lobbying Congressmen and Senators to pass a federal law that prohibits automobile manufacturers from requiring binding mandatory arbitration in disputes related to dealership franchise clauses. The law passed in 2002.

Why are so many consumer groups opposing mandatory arbitration in automotive transactions?
Many mandatory binding arbitration clauses are written to protect the dealer. Here are problems and dangers noted by consumer advocates.

Consumers are often unaware they've agreed to binding arbitration. Whether the mandatory binding arbitration agreement is tucked in a paragraph of fine print or provided as a separate form, dealerships often don't mention it until the consumer is ready to sign and take the new vehicle home. A few dealers may "forget" to mention the arbitration requirement at all. These tactics deprive consumers of their right to make an informed decision.

Binding mandatory arbitration severely limits consumer options for resolving a dispute. Before any problem arises, you lock yourself into only one optionbinding arbitrationfor resolving all future disputes or problems. The contract typically also names the arbitration company that must be used.
Binding mandatory arbitration clauses generally bind the consumernot the company. The way most mandatory arbitration clauses are written, the seller retains its rights to take any complaint to court while the consumer can only initiate arbitration.

Arbitration does not follow clear, well-established, consistent rules and procedures such as those required for litigation in the court system. For example, arbitrators aren't required to follow procedures that enable one side in a dispute to request information from the other (what the courts call "discovery"). The result is that consumers, who usually have limited resources, may have difficulty getting information needed to support their claims. In addition, nothing absolutely requires arbitrators to take the law and legal precedent into account in making their decisions although they are supposed to do so. Most decisions cannot be appealed, and there are generally no review bodies or other oversight to ensure that arbitrators follow fair procedure or the law.

The seller generally picks the arbitration company"the judge." In theory, both parties agree to the selection of a neutral, independent arbitrator. In reality, the seller designates the arbitration company in the contract. This situation can definitely affect the impartiality of the arbitrator. Studies show that any time one company depends on another company for a large percentage of their business livelihood, some systematic bias in favor of that company may develop.

Binding mandatory arbitration frequently costs more than taking a case to court. One of the benefits usually claimed for binding arbitration is that it costs less than litigation. Frequently this is not true. In many cases, for instance, a consumer may have to pay a large fee simply to initiate the arbitration process. This can deter a consumer from even bringing a complaint. Or on a small claim total fees for arbitration can easily exceed the amount you might be awarded if you win the dispute.

Do companies require mandatory binding arbitration even with cash purchases?
Yes.

Are there companies that don't require mandatory arbitration clauses?
Yes. There are plenty of good businesses that refuse to require mandatory binding arbitration. These are usually the companies with the fewest consumer complaints.

What can I do about the problem?
Don't deal with any companies that require a mandatory binding arbitration clause. Before spending time with the sellerwhether in person or onlineask the seller if they require a mandatory binding arbitration clause. If the seller does require an clause, tell the seller you won't buy from them and why.

If a seller requires that you sign a mandatory binding arbitration clause, refuse to sign it. Stick with your decision. Be prepared to leave without completing the purchase.

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ABC News Original Report Aired on February 22, 2005 and reported by Peter Jennings.
"Fine Print May Waive Legal Rights"
Mandatory Arbitration Clauses Reduce Consumer Rights"

Feb. 22, 2005 When American consumers sign contracts for credit cards, bank loans, mortgages or telephone service language in the fine print often waives their right to employ the full extent of the law should the company violate the contract.

"I feel completely violated, and that's the only term that I can use to explain it," said one woman who bought a car and says she got a lemon. "Had I known that arbitration clause existed in the contract, I would not have signed it."

"If you did a public survey, you would find that 99 percent of consumers are totally surprised that there's small print in there that doesn't allow them to go to court," said Joan Claybrook, president of Public Citizen, a consumer advocacy organization.

The fine print of many contracts says consumers "waive the right to go to court" to resolve any disputes about a product or service. They are instead committed to binding arbitration.

The process started with the Federal Arbitration Act of 1925, which gave companies a quicker way to resolve disputes. Instead of a judge or jury handing down a decision, the companies agree to go before arbitrators, who are typically practicing attorneys. They decide the amount of the arbitration award, if any.

During the 1980s and '90s, several courts ruled that arbitration should apply to individuals, as well.

'A Take-It-or-Leave-It Contract'

Many consumer advocates say mandatory arbitration means the consumer loses a fundamental right.

"It's a take-it-or-leave-it contract," said Claybrook. "You either sign it or you don't get the job or the credit card or the bank account."

Binding arbitration is just that. Except in very rare cases, there is no appeal, and arbitrators don't have to explain their decisions.

The American Arbitration Association, the oldest group that conducts arbitrations, says the law is a practical one.
"An average consumer arbitration through our organization takes about four, 4 months. Typically in court, if you're not going through small claims court, you're talking about years," said Richard Naimark, senior vice president at the arbitration association. The association also says there are guidelines to ensure fair play. "If the process is properly balanced so it's really a level playing field, neither side has an advantage," Naimark said. "There will be times when either the business or the consumer or employee will feel uncomfortable because they are on the losing end." But Claybrook says the system is flawed.
"The process completely favors the corporation," she said. "The corporation does repeat business with the arbitration company and if the company routinely finds in favor of consumers or gives large awards to consumers, they don't get used again."

Brad
Plano, Texas
U.S.A.

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