Supreme Court allows retroactive interest rates in case

January 24, 2011 5:34:06 PM PST
On Monday, the nation's highest court dealt a blow to consumers outraged at higher interest rates charged by their credit card company.

Countless consumers have complained in recent years about retroactive rate increases on their credit cards without being first notified.

The justices unanimously ruled that Chase Bank did nothing wrong when it did that to one of its card holders.

James McCoy sued Chase after it raised its rates retroactively because he was late on his payments. But the court ruled that federal regulations at the time did not require him to be told in advance.

The law has since been changed and now banks must give consumers 45-days notice before raising interest rates and often it's not allowed to be done retroactively.