A "pre-approved" e-mail offer for a PayPal Visa card through Providian National Bank has raised the hackles one of one reader, and gotten me pretty worked up as well. Of prime concern is Providian using information from our PayPal accounts to run a credit check prior to sending us the e-mail. But the entire maze of obtuse and contradictory terms and privacy policies make for a classic case of sneakwrap-style e-finance.
"The fine print says I was preapproved because of a credit report that the bank, Providian, decided to run on me," the reader wrote. "They inform me I can notify the consumer reporting agencies not to let anyone else get a report a credit report for a transaction I did not initiate, but it's too late to stop them."
The reader, who uses PayPal a lot in his business, was particularly concerned about how much of his information might be shared between the two companies. "I can just imagine what would have happened if my credit report hadn't come back so positive," he wrote. "PayPal would mark me down as a credit risk and start putting holds on my payments. And I would never have even known why."
After receiving this gripe, I realized I'd gotten the same PayPal Visa e-mail myself. (I'd originally ignored it on the assumption it was yet another phony PayPal "phisher" pitch, but closer inspection revealed it really was tied to my PayPal account.) Four different documents - an "important terms" and disclosure page, a "Site terms of use," and privacy policies for both PayPal and Providian - were linked to from the e-mail. Reading them all only served to make it all the more uncertain just what terms and policies applied to the credit card offer.
While PayPal's privacy policy generally forswears giving customer information to other parties, it makes a specific exception for Providian. For its part, Providian's privacy policy pretty much allows the company to disclose the information it collects about you to anyone. It does provide an 800 number to toll free opt-out number to ask them not to share any of your information for marketing by outside companies, but the automated answering system requires you to enter your Providian credit card account number. If you're not taking them up on the credit card offer, how can you keep them from sharing the data they've collected from PayPal and the credit report with others?
Worse yet, the "Site Terms of Use" suggests that all these documents apply "regardless of whether you apply for or receive a credit card offered on this Site." The document, which appears to have been written by Providian although it has the PayPal logo on top, also disclaims all responsibility for "any inaccuracies, errors or omissions in the Content on this Site or a Linked Site." So if the interest rates they're quoting you turn out to be completely bogus, hey, it's your problem. "You are responsible for assessing the accuracy and completeness of any information obtained from this Site."
Sure, you can reach into your mailbox any day and pull out some credit card offers with confusing and suspect terms. And, who knows, maybe the credit card issuer ran a credit check on you first. The difference, though, is that they won't have all the sensitive information about your bank accounts, existing credit cards, and your business that PayPal could have given Providian about me and my reader. Since I'm responsible for assessing the accuracy and completeness of their information, let me do so by saying I won't be trusting any credit card offer PayPal or Providian Bank make.
10:18:46 AM 
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