Payment Card News

Card Shutdown

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Spiegel’s First Consumers National Bank is notifying cardholders that their VISA and MasterCards cannot be used for purchases after today. However, Spiegel’s store credit cards, including the Eddie Bauer, Spiegel Catalog, and Newport News cards are unaffected by the action. Some “Eddie Bauer MasterCards” and “Spiegel MasterCards” may also be affected among the 740,000 cards being shut-down this weekend. FCNB was notified February 14th by federal regulators to liquidate its bank credit card portfolio. The OCC required FCNB to stop accepting new credit card applications and stop granting credit line increases to any of its existing credit card accounts; and to notify its existing cardholders that FCNB will not accept any new charges on their accounts after April 1st. The bank has been trying to sell its portfolio after signing a consent order with the OCC in May 2002 to end the issuance of sub-prime credit cards. FCNB agreed at that time to stop issuing any new secured credit cards unless it is fully secured; increasing the credit line of any existing secured credit card, or issuing any new unsecured or partially-secured credit cards to any existing customer with a low credit score. Spiegel has posted huge losses in its bank credit card portfolio after the collapse of the economy in 2001. The issuer specialized in issuing secured cards, partially secured cards, and unsecured cards to consumers with credit scores under 680. For more information visit: www.fcnb.com.

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