My search for answers to my question led to the exact reason for a bank's license to charge as much interest as they please. Hidden in almost all credit card agreements (does anybody other than the writers, read these?) is a clause for Universal Default. Simply stated, any negative information landing on your credit report by any creditor can trigger "Universal Default" allowing any other creditor to raise their interest rate on your account. According to US laws there is no limit on the raise.
I have discovered a very interesting article that explains some hidden secrets behind credit card company ripoffs. Here is the link:
http://www.pbs.org/wgbh/pages/frontline/shows/credit/eight/
More happy reading coming soon...
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