Kevin Parkinson not happy with Credit Cards Rules for Quebec vs Canada nor with MP Lauzon’s reponse – Cornwall Ontario – May 18, 2010

Cornwall ON – Kevin Parkinson is not happy with our MP Mr. Guy Lauzon.   Mr. Parkinson wrote a piece about Credit Card interest rates and sent our MP a letter.   Mr. Parkinson has asked us to print this chain.

Dear Kevin,

Thank you for sending me your email regarding credit card interest rates. I do agree with you that Canadians need access to consumer credit on terms that are fair & transparent. I believe that the best consumer protection framework includes competition, full fee disclosure & choice. We’re protecting consumers who use credit cards with our new regulations to require clear & simple information, require clear & timely advance notice of rates & fees changes, and limit credit business practices not beneficial to consumers. With better information, Canadian consumers can better make informed decisions. We’re helping consumers understand their options. The government has also established Canada’s Task Force on Financial Literacy to inform a national strategy to improve financial education. I would like to thank you again for taking the time to share your  thoughts with me.

Best regards,

Guy Lauzon, MP

Stormont-Dundas-South Glengarry

This was in response to Kevin’s query.

In the April CIBC VISA card statements, an updated Cardholder Agreement was enclosed explaining some recent changes.

Written in legal language that is difficult to read and understand, as of September 1, 2010 cardholders will be paying more interest on their purchases. It matters not that banks continually show record- breaking profits even during a recession, they consistently change the rules to skim more profit from the working class and middle class people.

I contacted the CIBC VISA Centre to confirm my understanding of these changes.  Here is a concrete example of how the new policy is intended to work.

A VISA cardholder has a balance of zero. He spends $100 in month #1 and makes a $10 payment.

The balance on the card for the next month will be $90 plus interest on the full $100 because only a partial payment was paid.

In month #2, the person spends $200 so the new balance will be $200 + $90 + interest + interest on all the new purchases!

In other words, the bank does not give you a chance to pay the $200 without interest, because a full payment was not made on the account the previous month. So essentially, the bank punishes you in month #2 because you only made a partial payment in month #1. The banks call this ‘residual interest’.

It gets worse.

This policy does not apply if you live in Quebec- only if you reside in one of the other Canadian provinces. In Quebec, the banks are not permitted to charge ‘residual interest,’ so using the above example, interest would not be charged on the $200 in month #2 if it was indeed paid in full by the due date.

In conclusion, there are several questions here:

Why is the Canadian government allowing the banks to charge residual interest at all, since it is unfairly punitive and adds large amounts of interest and creates more consumer debt.

Why have the banks implemented this change in the middle of the worse global recession since the 1930’s, as people are struggling to stay out of debt?

Finally, why is Quebec the only province in Canada to get preferred treatment by the banks?

People in Canada need to send this letter or one similar to their MP and MPP asking them to investigate this matter, and put pressure on the banks to remove the residual interest clause before September 1, 2010, and put this money back in to the pockets of Canadian taxpayers, except those in Quebec who are already exempt from this usurious interest grab by the banks.

And this was the letter that Mr. Parkinson sent to Mr. Lauzon in reply to Mr. Lauzon’s response.

Dear Mr Lauzon:

I am disappointed that I sent you factual information about how VISA Infinite imposes residual interest on all provinces except Quebec, but your response did not answer my question.

The point is, your government is protecting cardholders in Quebec but not in any other province. I want to know why that is the case.

I hope that now you will understand my question, and that I expect a direct answer, not some talking points or copied material that has been used elsewhere.

Sitting in the House of Commons too long has an adverse effect on honourable members, since rarely does any question in the house get answered. Answers tend to be long winded rhetoric, very similar to the answer which you provided for me.

I look forward to your response.

Thank you for your cooperation in this matter.

Yours truly,

Kevin Parkinson

So Cornwall and Canada; is Mr. Parkinson over reacting to Mr. Lauzon’s reply?   What do you think of this issue?  Feel free to post your comments below.

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  1. Kevin
    I would not expect an answer, In my dealing with Guy he lacks the ability and fortitude to understand your question.

  2. Overreacted thats for sure. Lets face it guys, Guy Lauzon MP is just that. He’s not some rabid moron, frothing at the mouth, doing absolutely nothing for us. If that were the case then we would have replaced him by now. He is an MP and deserves the respect inherent to that position. Let he, who is without fault, cast the first stone now!

  3. OK, what has he done for us? His office staff run a pretty good passport service, and they’re good at solving problems with EI. But that’s his staff who do that, not our MP himself. True, he’s brought us a call center, but then again, he also brought us the staff from Ottawa to work there and take their salaries back to Ottawa. Being as the staff are no doubt members of CUPE, we’re talking some serious bucks here.

  4. Oh, sorry, I forgot his other major accomplishment, so I should mention it, just to be fair.
    He keeps thousands of forest, pulp mill, and postal workers employed with his stupid drivel, (I think he believes it’s called “communicating with his constituents”), which gets stuffed in my mail box whether I like it or not.
    And I agree, he’s not “some rabid moron, frothing at the mouth…” Number 1, he doesn’t seem to have the energy, number 2, I’m sure he was sent to the veterinary clinic for his rabies shot before being allowed within spitting distance of King Stephen.
    And yes, we should respect our MPs because of their positions. However, that works both ways. Guy has been offered countless opportunities to appear in the Cornwall Free News to talk about his position, but he doesn’t have the respect for his constituents to deign to communicate with them in this way.
    Finally, if we had an MP, I wouldn’t necessarily agree with him/her, but I would give him/her a certain amount of respect. Unfortunately, the citizens of Cornwall and area do not seem to have an MP.
    Thank God Jim Brownell is our MPP, and not some trained Tory seal.

  5. Well if we follow your logic…..then we may as well fire the heads of all corporations since they do nothing, or not much, and it’s the workers who do all the work. So who needs CEO’s?
    Last time I looked we were still living in a free country and our MP can pick and choose to be interviewed, or not, by anyone he chooses.

  6. Sorry, you’re totally wrong. The job of a CEO is to take overall control of a company, to make sure all beneath him are pulling in the same direction. If he fails at this job, he either gets fired (with or without the “golden handshake”), or his company is Nortel or Chrysler.
    And yes, last time we looked we were living in a free country. In a free country, politicians are accountable to the electorate, and that includes making time to be interviewed by anyone with a legitimate reason, whether it be the Free Holder, Corus Radio, the CBC, or the Cornwall Free News. It is in the “not-free” countries, such as Iran, Communist Russia, Nazi Germany, Zimbabwe, China etc. that politicians have the privilege of riding roughshod over public opinion and not being answerable to the electorate.
    I hope this is not the situation Harper and the rest of the Reform Party are planning, but when people as intelligent as you obviously are start to defend a politician such as Lauzon for refusing to answer questions from the media or the electorate, it seems to me we are on a long and slippery slope that will lead nowhere good.

  7. I agree with The Watcher, and I love the “Reform Party” jab. Well played.

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