You are viewing an obsolete version of the DU website which is no longer supported by the Administrators. Visit The New DU.
Democratic Underground Latest Greatest Lobby Journals Search Options Help Login
Google

Reply #2: because SD is a favorite state of the CC industry (see below) [View All]

Printer-friendly format Printer-friendly format
Printer-friendly format Email this thread to a friend
Printer-friendly format Bookmark this thread
This topic is archived.
Home » Discuss » Archives » General Discussion (1/22-2007 thru 12/14/2010) Donate to DU
book_worm Donating Member (1000+ posts) Send PM | Profile | Ignore Tue May-19-09 04:53 PM
Response to Original message
2. because SD is a favorite state of the CC industry (see below)
South Dakota a Favorite State for Credit Card Companies
By: LawInfo
Published: 05/2008
Do you ever wonder why your Citibank credit card bill comes from South Dakota, and your payment goes there as well, when you know that Citibank is headquartered in New York? It is because of a combination of federal law and 50 different state laws that allow a bank in New York to use a South Dakota address to bill a customer in California.

Usury Laws

Many states have a usury law which limits the interest rate that a company may charge.
Most of these laws capped interest rates at 18%. However, some states, such as South Dakota, do not have a usury law, allowing in-state businesses to charge as much interest as they want.

Congress has the power to regulate interstate commerce, which includes regulating nationally chartered banks which do business in more than one state. In the Supreme Court case Marquette v. First Omaha Service Corp. in 1978 the Court ruled that nationally chartered banks do not have to follow state law in which they do business, but only the law of the state in which the company is incorporated. Because state usury laws were not uniform this rendered all of them irrelevant as credit card companies picked up and moved to the states that allowed them to charge the highest interest rates.

After the 1978 ruling only national banks were exempt. If you banked with a bank which only did business in your state you were protected by your state's law. But a federal law now exempts state
http://resources.lawinfo.com/en/Articles/Credit-Card-Gift-Card-and-E-payments/Federal/south-dakota-a-favorite-state-for-credit-card.html
Printer Friendly | Permalink |  | Top
 

Home » Discuss » Archives » General Discussion (1/22-2007 thru 12/14/2010) Donate to DU

Powered by DCForum+ Version 1.1 Copyright 1997-2002 DCScripts.com
Software has been extensively modified by the DU administrators


Important Notices: By participating on this discussion board, visitors agree to abide by the rules outlined on our Rules page. Messages posted on the Democratic Underground Discussion Forums are the opinions of the individuals who post them, and do not necessarily represent the opinions of Democratic Underground, LLC.

Home  |  Discussion Forums  |  Journals |  Store  |  Donate

About DU  |  Contact Us  |  Privacy Policy

Got a message for Democratic Underground? Click here to send us a message.

© 2001 - 2011 Democratic Underground, LLC