Some background on consumer debt

An advertisement from La Polar, one of Chile's largest retailers and the subject of a fraud investigation

The New York Times has an article on credit card debt in Chile and Brazil, with a good summary of the scandal surrounding retail giant La Polar, under investigation by the Chilean Securities and Insurance Supervisor. The agency has charged eighteen La Polar executives with fraud after the company repackaged the debts of thousands of low-income customers who had used the store’s credit card.

Chilean consumer debt rose by 254 percent, to roughly $34 million, between 2001 and 2008,  according to the Central Bank. with debt-to-income level more than 70 percent at the end of 2010.

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