For Immediate Release
Contact: Nicole Y. Williams
Washington, D.C. – Today, Congresswoman Barbara Lee (D-CA) voted in support of the Credit Cardholder’s Bill of Rights. During a discussion on the House Floor, Congresswoman Lee encouraged House Financial Services Committee Chairman Barney Frank to work to ensure that the protections in this bill go into effect as quickly as possible following its enactment – preferably within the bill’s original three month time frame. She released this statement:
“I believe that the critical protections contained in this legislation will strengthen the regulations issued by the Federal Reserve and I strongly support its passage. However, I am concerned that during these incredibly difficult and challenging economic times, our constituents are increasingly being squeezed with egregious fees and dubious business practices by the very banks that their tax dollars have been bailing out.
“The newspapers are rife with stories about consumers being gouged by banks that have suddenly jacked up interest rates on their credit cards, imposed new monthly service charges or reduced credit limits with little or no explanation. In most cases these tactics are being used on consumers, who although they carry a balance from month to month, pay their bills on time and make at least their minimum payment. We’ve also heard countless stories of bait and switch tactics by credit card companies who suddenly raise interest rates because a consumer is a few days late in paying another creditor.
“Years ago, I worked with now Senator Sanders on legislation to address this practice of so called ‘universal default’. I’m pleased that language is in this bill, but it is critical that the protections banning this practice are put into place immediately.
“Originally this bill contained a three month window following the date of enactment to allow banks to adjust their systems and comply with the law. However, the bill that we have now before us would allow these practices to continue as much as 1 year after the enactment of this bill, or June 30, 2010 – whichever comes first. I am concerned that this one year delay incentivizes the banks to accelerate the use of these egregious tactics to ensure that they can reap the maximum amount of money possible from our constituents.
“The fact is that the banks know the handwriting is on the wall. They are boosting up fees and rates on consumer now. The longer we wait to ban these practices the more our constituents will suffer. To me and many people across this country, that is outrageous and unacceptable.
“If they can raise interest rates on credit card holders overnight for no reason whatsoever, then they should be able to comply with these restrictions in an equally swift manner. More importantly, if we can take extraordinary measures to bailout the banking industry for their greed and mismanagement, the least we can do is ensure that they don’t fleece our constituents with higher rates and fees.”
The Honorable Barbara Lee (CA-9)
2444 Rayburn House Office Building
Washington, DC 20515
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