There is a pretty smooth transition between the flow of news in this week’s wrap-up. Beginning with two airline credit cards that emerged this week, we then move to the CFPB taking credit card complaints while AmEx tremendously expands their brand. Finally, the FTC will be sending out checks to homeowners who suffered from shady mortgage practices.
The Airlines
Democratic Senator Chuck Schumer wrote a letter this week to major airlines that in addition to requiring airlines to reimburse customers who paid excess baggage fees and then had their luggage lost during a trip, customers who lose a bag for days and then have it returned should be reimbursed as well. If airlines ignore the letter, he will propose a bill to Congress.
With regards to the high cost of running an airline, Delta made two separate, yet somewhat controversial announcements.
Although eliminating service to 24 cities will save them $14 million a year, they are spending close to $1.2 billion on the gaudy new JFK terminal 4 in New York.
Read: Delta Expands Terminal, Cuts Domestic Flights
However, after posting profits this quarter Delta still managed to come out on top of American, which was the sole airline to report losses. But that didn’t stop them from rolling out a credit card this week in conjunction with Citi, while the following day the merged United and Continental Airlines did the same with Chase.
Credit Cards
Speaking of credit cards, on Thursday the Consumer Financial Protection Bureau began accepting complaints regarding credit card issues on its website. Any consumer who feels they’ve been treated unfairly by card companies can describe, categorize, and provide details of the issue and pose a reasonable solution to their problem. The CFPB was formed as a result of the financial crisis and is responsible for overseeing the financial services industry and shielding consumers from predatory practices.
On that note, let’s see how Google (NYSE: GOOG) fares now that they released a credit card in conjunction with Google AdWords, which will benefit small businesses looking to advertise themselves. While most financial institutions offer cash for card sign up, Google challenges that formula by offering free exposure and business expansion.
Check out: Google Credit Card In the Future for Small Business
As always, when we mention credit cards we have to consider huge developments in NFC. AT&T Mobility, T-Mobile USA, and Verizon Wireless have formally partnered with Visa, MasterCard, Discover, and American Express for Isis, a joint venture to expand mobile commerce nationwide.
American Express
If you want a more focused look into the future of mobile payments, check out what AmEx (NYSE: AXP) has been up to this week.
First, they partnered with Sprint to allow Androids users access to the Serve mobile wallet, which can make person-to-person payments, in-store card payments and online transactions. Serve will make the payments through Sprint Zone.
They also brought coupon-less deals to Facebook through a new app call “Link, Like, Love.” When you link your American Express Card you can choose from exclusive deals, and after you swipe, statement credits will be sent directly to your Card account.
Banks
Finally, we would be remiss if we didn’t discuss the developments in the housing crisis, as homeowners who were victims of dubious practices by Countrywide and Wells Fargo will be receiving checks in the mail.
Countrywide abused struggling homeowners by charging them excessive fees for services like property inspections and lawn mowing during the housing crisis. Now the FTC will send around 450,000 checks worth $108 million to those serviced by Coutrywide between January 1, 2005 and July 1, 2008.
The Federal Reserve also found that Wells Fargo & Co. (NYSE: WFC) falsified loan documents and steered borrowers toward high interest rate subprime mortgages during the housing boom. The bank will pay $85 million to settle civil charges as well as another approximately $115 million to eligible homeowners.
Full coverage: Fed Penalizes Wells Fargo $85M for Mortgage Abuses
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