Earlier this year, the ZapMe! Corp. tried to hawk Cobaltcards to students and got zapped by the public. Now Channel One is advertising these cards during classtime. They hoped no one would catch them. Sorry, Channel One, you are busted.
What, you say, is a Cobaltcard?
It is a "buying card" that attempts to get children into the credit card habit at a very early age. It is not a credit card but it has the "feel" of one. The way it works is the student, or parents, sign up for an account and then move money from a credit card or checking account into the child’s Cobaltcard account. When the child sees something he or she wants on the Internet, they can facilitate the purchase by simply using the Cobaltcard account number. The amount of the purchase is deducted from the child’s account.
The card (pictured above) is issued to the child and they keep it in their wallet like a credit card. This will allow children to make more purchases while they surf the web. The card will allow more impulse buying.
You can have up to $2,000 on one Cobaltcard and you can add up to $2,000 each day to the card. The $50 limit on liability that protects credit card holders does not apply to the Cobaltcard. A child that misplaces their card could be (or parents could be) liable for all unathorized purchases made the card.
Jim Metrock, president of Obligation said, "Our public schools should not be advertising this card. This is an affront to parents. This promotes the credit card mentality that has hurt many young adults. We certainly shouldn’t be encouraging teenagers to be signing up for credit, debit or buying cards. The Cobaltcard is a clever way to get children to become American Express card holders."
Obligation has sent an email and letter to Mr. Jim Ritts, president of Channel One requesting a discontinuation of the Cobaltcard.com commercials.
"There are serious privacy issues with this card," Metrock said. "Personal information is taken from children and they track all purchases made by the child. They state that no personal identifiying information is going to go to third parties, but then state that the company can change their privacy policy at any time and therefore children should check back often to see if the policy has changed. This is unacceptable. This is not a product that I think many parents want their children to possess. Certainly, they don’t want their child’s school time wasted with commercials for it."
Metrock said, "Channel One is clearly getting worse. The new management is pushing the envelope with America’s children. In 2001, school boards must take the initiative and remove Channel One once and for all from classrooms."
Back to News About Channel One 2002
Obligation, Inc. 3100 Lorna Road, Suite 311, Birmingham, AL 35216 205-822-0080 Fax 205-822-3336, [email protected]
