Reduced credit may be someone else's fault

Jan. 28, 2009 at 5:52 PM
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NEW YORK, Jan. 28 (UPI) -- U.S. credit card companies limiting credit to customers based behavioral analysis may have "crossed a line" a credit card expert said.

At least one company, American Express, is limiting credit to customers based on the track record of other customers who frequent the same stores, ABC reported Wednesday.

"They're saying, 'We don't like the behavior of other people that are shopping in stores that you are currently conducting business," Robert Manning, director of the Center for Consumer Financial Services at Rochester Institute of Technology, said. "They've crossed the ethical line … based on these financial times."

Some customers with good credit histories may be headed to discount stores during financially hard times, a rational decision that may later haunt their credit availability, ABC reported.

American Express, in a statement, said, "our intent is to strike the right balance between accommodating our card members … (and) prudently managing credit risk."

Kevin Johnson of Atlanta said, "I think offended is an understatement," after American Express reduced his credit from $10,800 to $3,800 with a letter that explained one reason for the change was "other customers who have used their card at establishments where you recently shopped have a poor repayment history."

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