My present to Bank of America/MBNA this year is a big fat lump of coal: I'm closing my credit card with the combined company, after experiencing some of their abusive, shady, and unfair practices.

I thought I'd share my account closure letter with aD readers and the internet in general. After reading this, you may want to avoid Bank of America (not that I think there are many "fair" financial institutions out there):

Since your company failed to completely pay off all liabilities on the card from my Bank of America checking account as I instructed on the phone last week, I am enclosing a check for two dollars to make up the remaining balance owed (plus any interest that may be unpredictably incurred between now and when the money is received).

I am closing the account for two main reasons:

(1) Last year, MBNA abruptly changed the terms of my account from a 5.9% fixed rate to a variable rate, beginning in excess of 10%. When I inquired why this had been done, despite no delinquency on my part, an MBNA representative told me it was due to "interest rates rising" and that there was nothing he could do about it.

Later I discovered that my credit score had abruptly deteriorated at the same time, mostly due to a number of "phantom" accounts appearing on my record by the mistake of the credit card companies (I immediately had this corrected). I also found out that a friend who had the same 5.9% rate with MBNA had been able to keep this rate (and still does to this day).

So what really happened was that MBNA invoked the "universal default" provision (which I only recently learned about) to change the terms of my account when my credit score changed -- despite the lack of delinquency on my part -- and then lied about this. While the lie was bad enough, the "universal default" practice is an abhorrence which I consider grossly unethical. I suspect it will become illegal sooner or later.

At the moment I discovered this is what happened, I planned to ultimately close my MBNA account. The question was simply when.

(2) That final question became answered this month, when I received a statement informing me that my account was "past due" by a ridiculous $10 amount, because my minimum payment had gone up. Previously I had had an automatic monthly payment set up to cover the minimum, with room to spare. This had to be done because MBNA's payment system does not allow the customer to pay a variable minumum.

While it is true I could have checked the previous month's statement more carefully and made a supplementary payment, and then changed the automatic payment, and then checked every month for the next few months to see if the new automatic payment was in fact occurring (since, as your associates admit, one cannot predict precisely when this will happen), it is ridiculous to have to do all this. In reality, nearly every other financial company I have ever done business with allows the customer to pay a variable minimum payment automatically.

This is not rocket science. It is obvious MBNA utilizes an inflexible electronic payment system to artificially put customers into delinquency, and then bludgeon them to death with fees. I choose to no longer do business with such a company. This was the "last straw".

So please close the credit account and report it to the credit agencies as closed at my request. If I find that any delinquency has been reported on my part, your company can expect a legal challenge and the loss of all my business with Bank of America.

Regards,

Aaron Krowne

P.S. - This letter is being posted on the Internet at my blog, http://www.autodogmatic.com. I am also widely reporting the incident to the press and consumer advocacy venues.