Do banks ever increase credit card interest without notice?

A fascinating letter from a reader arrived that is a must-read for anyone who has one or more credit cards and wonders about whether the credit agencies or banks ever pull sneaky tricks on us consumers:

Great blog on the AT&T upgrade article; I thought I was one of the few that noticed how devious these companies are when offering their promotions. I have the AT&T premium card and everything you pointed out was funny to me too; but there's one thing I notice and don't know how to counter attack...

I have two balance transfers with a great promotional offer (0% until pay, 1.9% until pay). I monitor my bill every time to see if they pull a fast one on me and they recently have. According to their policy if one defaults in their payments they can increase the interest rate to 28% (which I had at 10.49% for the regular balance; not balance transfer) like you mention in the blog; but I have always been on time and not defaulted in anyway.

Just recently I notice an increase on the regular balance interest rate to 14.25%. I was shocked, so I got my previous statements and confirmed that they have been slowly increasing the interest rate in increments 11.2, 11.4, 11.9; just like if they were testing me to see if I complaint.

Well I call them up and they say that the reason for the increase is due to the increase of prime but after reviewing my account the rep decided to lower the rate to 12.9% which is better than 14.25%. Does this sound tricky to you or is it a bad business pratice?

The same happend to my CapitalOne merge to Chase (Sony card); after the merge my 10.5% rate when up to 28%. I called and they said that after reviewing my credit report the felt I had high debts and they needed to increase it. My credit is fine, only one credit card at $6,000 and theirs??

Let me know what you think; if you want me to elaborate on the examples let me know. Thanks for the great info.

Fascinating stuff. I'm not sure what to say in response other than to highlight the importance of staying attentive to your credit card bills to make sure you don't have a gradually increasing interest rate yourself. It does seem to me that the bank should include some sort of notification if they're changing your interest rate, but obviously the small print in the original card holder's agreement allows them to do what they want, and if you don't notice it, well, 28% sounds like what Lenny the Loanshark would be offering, doesn't it?