|From: News and Views | City
Sunday, September 19, 1999
Pols Take Credit for Bill
New York-area members of Congress have introduced legislation to
reform the credit card industry. The most comprehensive is a series
of proposed changes, the Consumer Credit Card Protection Amendments
of 1999, introduced by Rep. John LaFalce (D-N.Y.).
A companion bill has been introduced in the Senate by Sen. Chuck
Schumer (D-N.Y.). It would, among other things, require that credit
card solicitations provide full disclosure of permanent interest
rates, not just "teaser" rates, and make it clear how long it will
take to pay off the card balance if only minimum monthly payments
The Schumer bill also would:
- Ban credit card issuers from canceling accounts or imposing
new fees on cardholders who routinely pay off monthly card
balances in full.
- Ban credit card accounts for those under 21, except with
parental approval or evidence of means of payment.
- Require full disclosure in billing statements of required
payment due dates and applicable late payment penalties.
- Roll back any interest rate increase when the customer
notifies the issuer he is canceling the card.
- Prohibit card issuers from charging fees or penalties for
over-limit spending when the issuer itself authorized the
In addition, Rep. Robert Menendez (D-N.J.) will be reintroducing
the Fair Credit Card Application Act. The proposed legislation would
prevent credit card companies from issuing cards consumers did not
The bill also would require prominent warnings that an alternate
card with different benefits, interest rates and terms might be
issued. Consumers would be given the clear option of declining
Both bills, though they do not limit fees or interest rates, face
tough sledding in a Congress where the banking industry is a major
campaign contributor to House and Senate candidates, pumping more
than $2 million to members of the House Banking Committee
The single largest giver? Bank One, which donated a total of
$201,300 to banking committee members.
Special Report: Credit Quicksand Traps Consumers
Special Report: Getting Yourself Out of Trouble (09/19/1999)
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