Capital One Asks Consumers to Pay up on 11 year-old Debts

Mar 08, 2011, 09:00 ET from Morgan Drexen

ANAHEIM, Calif., March 8, 2011 /PRNewswire/ -- As American consumers struggle to cope with current high unemployment and rising debt, some credit card companies are drudging up old debt in the hope of raising their profits. Morgan Drexen supports the automation for attorneys throughout the country and therefore question if there is enough protection in place.

The credit card industry has changed in the past year, however Morgan Drexen has heard the attorneys it supports ask is enough protection in place for the average consumer? The Credit Card Act of 2009 is now in full swing providing Americans protection against abusive creditors. According to a survey carried out by the Consumer Reports National Research Center consumers are now carrying less debt. The average credit card balance is $3,793 that is $1000 lower than 2009.

The survey also showed that there was a slightly lower level of dissatisfaction with credit card companies in general. Despite the positive changes there are still some perilous actions being carried out by credit card companies.

Frank Cavestani is an actor best known for his roles in "Born on the Fourth of July," "A Few Good Men" and "Apollo 13." Frank admits that being an actor can be unpredictable and there are times when he would find himself not adorning the big screen, and not earning. However, imagine his surprise when he received an overdue credit card bill from Capital One dating back 11 years.

On contacting Capital One, the company then explained that due to the recent introduction of the new HR 4173 bill, otherwise known as The Dodd Frank Wall Street Reform and Consumer Protection Act, Capital One was entitled to send out this over due bill.

It seems that in an attempt to blindside the consumer, credit card companies are using recent legislation to try and claim old money that they had previously written off. There is a statute of limitations on this type of action.

Capital One later admitted that Cavestani was not liable for the debt and that despite the fact he had only received the letter in recent days, they had in fact been charging interests for several months but were behind in posting the statements. Frank admits, "I asked them if the interest they were charging was from 10 years ago or the interest rates from today?" In a letter to Capital One executive Richard Fairbanks Frank stated, "This action makes your company look like the barbarians and cruel Vikings that your TV ads jokingly portray," says Cavestani.

General Counsel for Morgan Drexen Jeffrey Katz says, "I am not sure there can ever be enough protection for consumers. I wonder how many American consumers succumbed to the letters distributed by Capital One. There is a statute of limitations on debt, which varies, nationwide. California, for example, has a fairly short statute of limitations on most debts: two years for oral contracts and four years for written contracts, promissory notes and credit card debts. The attorneys we support at Morgan Drexen deal with these problems regularly, using an attorney based debt resolution program has great advantages."

Credit card debt leads thousands of Americans into stressful situations that are very hard to free them from.  For Mary Thomas a Delaware resident, getting out of debt was all she thought about when she engaged with an attorney based debt resolution program. Mary engaged with attorney Richard Weinblatt, partner at Stamboulis & Weinblatt, LLC.

Weinblatt uses the automated legal support services of Morgan Drexen, this allows for the quick and effective transfer of information to get debts settled quickly and fairly. Weinblatt says, "I became an attorney to help people. Everyone deserves representation when they need it. I am there to help. Many creditors use legal counsel and therefore the debtor also needs legal support, this equals the playing field."

Mary declares, "Credit cards. I don't care for them anymore. No. They could get you in a lot of trouble. It wised me up in a lot of ways. Not to get in debt again."

When asked how it feels to be debt free, Mary answered, "Oh it feels wonderful. It's a great feeling."

SOURCE Morgan Drexen