Richardson Votes For Credit Cardholders’ Bill of Rights
2009-06-05 · By Editor
Today, Congress passed the sweeping Credit Cardholders’ Bill of Rights Act of 2009, (HR627) finally ending the unfair practices of the credit card industry and protecting consumers from the abusive tactics that continue to drive many Americans deeper and deeper into debt. President Obama is expected to sign the bill into law soon.
“With so many families in our community struggling to make ends meet, people who play by the rules and who make their monthly credit card payments deserve to be treated fairly by their credit card companies,” Congresswoman Richardson said. “The Credit Cardholders’ Bill of Rights gives people the information and rights they need to make smart and educated decisions about their family budgets.”
“Many people are making their minimum credit card payments, but they still face excessive fees, unfair interest rate hikes and changes to their card agreements with little or no notice,” Congresswoman Richardson said. “This bill finally levels the playing field between card issuers and cardholders and ends these financially detrimental policies. I look forward to the President signing the bill into law.”
Key highlights of the bill that will benefit families and small businesses in the 37th Congressional District include:
- Barring interest rate increases on existing balances unless a card-holder has failed to make even a minimum payment for 60 days, and outlaws double-cycle billing.
- Ending the deceptive practices of the credit card industry that targets students and minors with t-shirts, I-pods and promises of easy credit.
- Ending the so-called “Universal Default Rate” in which card issuers raise a cardholder’s interest rate because of behavior related to other creditors — even if the cardholder is in good standing with the card in question.
- Requiring card companies to apply a consumer’s monthly payment to the debt with the highest interest rate or to all debts equally.
- Requiring companies to give consumers 45 days notice before any interest rate increase.
- Prohibiting interest rate increases anytime in the first year that an account is activated.
- Prohibits charging fees to pay a bill online.
- Prohibits over-the-limit fees unless a consumer opts-in in advance.
- Establishing a Small Business Information Security Task Force to address the information technology security needs of small businesses and help prevent the loss of credit card data.
- Requiring all gift cards to have at least a five-year life span, and eliminating the practice of declining values and hidden fees for those cards not used within a reasonable period of time.
The credit card provisions take effect in nine months, but some provisions, such as the 45-day notification for interest rate increases, take effect in 90 days.
Congresswoman Richardson is a Democrat from California’s 37th Congressional District. Her district includes the city of Long Beach, Compton, Carson, Watts, Willowbrooke and Signal Hill. She is a member of the House Committees on Transportation & Infrastructure and Homeland Security.