Get Your Credit Card Provider to Pay YOU $25

Monday, Feb. 18, 2008

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I hate the foreign transaction fees that banks charge when you use a credit card overseas, especially when the banks embed the fees in the exchange rate.

Like me, some lawyers and their clients decided these fees are abusive. They filed class action lawsuits against Visa, MasterCard, Diners Club, and the banks that issue the cards. The court consolidated these class actions in 2001, and last year the lawyers cut a deal. In the settlement, the banks deny the claims and assert they did nothing wrong, improper, or unlawful. But they’ll pay up just to get rid of the lawsuit.

Read about the compromise at http://www.ccfsettlement.com/.

I read the settlement, the FAQs, and the forms. I’m no lawyer, but according to my reading, if you traveled at all during the 10-year period covered (Feb. 1, 1996, to Nov. 8, 2006), you get a settlement of $25. (To put this in perspective, the lawyers get $86 million, plus interest, and up to $5 million more in expenses. Those are just the plaintiff's lawyers, and just for this one lawsuit.)

But if, like me, you live abroad or travel regularly, you have two options that are better than the $25 flat fee. I tell you about them in the February issue of the IL magazine. Plus, I’ll tell you which bank offers people like us the best credit card…one that doesn’t charge those pesky fees. If you don’t yet subscribe to the IL magazine, you can subscribe now and get instant access to my article

Paul Terhorst
Roving “Retire Early” Editor, I nternational Living