For Immediate Release


Travis Plunkett, CFA, 202-387-6121
David Butler, Consumers Union, 202-462-6262
Ilicia Balaban, ConnPIRG, 860-805-5760
Lauren Saunders, NCLC, 202-452-6252
Linda Sherry, Consumer Action. 202-544-3088

Consumer Rights Groups

Senate Committee Passes Landmark Credit Card Bill

Consumer Groups Praise Senator Dodd for Progress on Bill to Curb Unfair Practices

WASHINGTON - Leaders of national and Connecticut-based consumer organizations today
lauded comprehensive legislation passed by the Senate Banking Committee to curb predatory credit
card lending practices. The groups praised committee Chairman and bill sponsor Christopher Dodd
for his strong efforts to enact the legislation.

Introduced by Chairman Dodd and 18 co-sponsors, the Credit Card Accountability
Responsibility and Disclosure (CARD) Act would ban a number of practices that credit card issuers
have used to unjustifiably increase interest rates, fees and other charges. It passed the Senate
Banking Committee yesterday, moving to the Senate Floor for a final vote.

"This is the first time ever the Senate has moved legislation to rein in abusive credit card
practices," said Travis Plunkett, legislative director of the Consumer Federation of America. "We
applaud Senator Dodd for his efforts to pass this sweeping bill in the face of strong opposition from
the credit card industry."

"The CARD Act recognizes that credit card companies target unsuspecting college students
for overpriced credit cards even when they don't have jobs or an ability to repay," said Ilicia
Balaban of ConnPIRG. "The bill requires them to treat students like they are supposed to treat other
consumers, fairly."

The Federal Reserve Board issued rules to stop unfair credit card practices, giving the
industry until July 1, 2010, to implement the new practices. A number of major card issuers are now increasing fees and interest rates on millions of Americans before the new rules take effect.
The House of Representatives passed legislation last year that was similar to the Federal Reserve
Rules and is likely to do so again this year.

The Credit CARD Act has a number of protections that extend beyond those of the Federal
Reserve rules and House legislation. It requires credit card companies to stop:

o Applying unfair interest rate hikes retroactively to balances incurred under the old rate.
o Hitting consumers with high penalty fees that are not related to the costs that credit card
companies incur.
o Assessing hidden and unjustified interest charges on balances already paid off.
o Piling on the debt that consumers owe by requiring them to pay off balances with lower
interest rates before those with higher rates.
o Offering credit to students and young consumers without considering their ability to repay
the loan.

"Senator Dodd's bill picks up where the Fed's rules leave off, protecting all Americans from
unjustified or excessive fees and stopping retroactive interest rate hikes that only bury struggling
families in insurmountable debt," said Lauren Saunders, Managing Attorney at the National
Consumer Law Center.

"This bill will put the force of law behind the Federal Reserve's new rules, and will protect
consumers by strengthening these reforms," said Pam Banks, senior attorney for Consumers Union.
"Credit card lenders are trying to take advantage of the fact that the Federal Reserve's rules don't go
into effect until 2010 by maximizing short-term income from credit card interest payments, even if
the consequences are harmful to their own customers."

"We know that there is a battle ahead to preserve the strong consumer protection standards
in this legislation, but we are ready for the challenge and grateful that Senator Dodd is with us in
fighting the unfair, anti-consumer practices of credit card companies," said Linda Sherry, director of
national priorities for Consumer Action.

For more information about credit card reform, visit the Consumers Union website


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The Consumer Federation of America is a nonprofit association of over 280 pro-consumer groups, with a combined membership of 50 million people. CFA was founded in 1968 to advance consumers' interests through advocacy and education.

ConnPIRG is a statewide, nonprofit, nonpartisan public interest advocacy group with both citizen members and student chapters ( and

Consumers Union is a nonprofit membership organization chartered in 1936 under the laws of the state of New York to provide consumers with information, education and counsel about good, services, health and personal finance, and to initiate and cooperate with individual and group efforts to maintain and enhance the quality of life for consumers. Consumers Union's income is solely derived from the sale of Consumer Reports, its other publications and from noncommercial contributions, grants and fees. In addition to reports on Consumers Union's own product testing, Consumer Reports with more than 5 million paid circulation, regularly, carries articles on health, product safety, marketplace economics and legislative, judicial and regulatory actions which affect consumer welfare. Consumers Union's publications carry no advertising and receive no commercial support.

The National Consumer Law Center, Inc. (NCLC) is a non-profit Massachusetts Corporation, founded in 1969, specializing in low-income consumer issues, with an emphasis on consumer credit. On a daily basis, NCLC provides legal and technical consulting and assistance on consumer law issues to legal services, government, and private attorneys representing low-income consumers across the country. NCLC publishes a series of sixteen practice treatises and annual supplements on consumer credit laws, including Truth In Lending, Unfair and Deceptive Practices, and Cost of Credit: Regulation, Preemption, and Industry Abuses.

Consumer Action ( is a national non-profit organization founded in San Francisco in 1971. During its more than three decades, Consumer Action has served consumers nationwide by advancing consumer rights, referring consumers to complaint-handling agencies through its free hotline, publishing educational materials in Chinese, English, Korean, Spanish, Vietnamese and other languages, advocating for consumers in the media and before lawmakers, and comparing prices on credit cards, bank accounts, telephone plans and other consumer goods and services.

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