How your credit card rips you off when you use it outside the US?

This excerpt is from the LA Times:

""TRAVEL INSIDER
Here a fee, there a fee, everywhere a credit card fee?
Plastic is handy when charging abroad, but you may be in for a nasty little surprise when you get the bill.



By James Gilden, Special to The Times

After a trip to Europe in April, I noticed my credit card statement looked different. An additional dollar amount was listed next to every charge in pounds and euros.

First USA, the bank that issued my card, calls it an "exchange rate adjustment." Bank of America calls it a "foreign currency conversion adjustment" on its credit card statements.

Whatever it's called, many banks are adding 1% or 2% to credit card transactions in a foreign country. As a result, travelers may end up paying more than they imagined for the convenience of using a credit card abroad.

And here's the rub: That new fee is on top of a 1% currency exchange fee that Visa and MasterCard (which are different entities from the bank that issues your card) already fold neatly and invisibly into the exchange rate on your credit card statement. That fee was the subject of a recent lawsuit.

That 1% more than covers the cost of the exchange. Currency conversion costs for Visa alone came to $6.9 million between Feb. 1, 1996, and Dec. 31, 2000. During that same period, it collected $630.1 million in currency conversion fees, according to documents from a court case filed in Northern California's Alameda County.

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