WASHINGTON-Key members of the Senate Banking Committee promised new protections to credit cardholders that would go further than reforms enacted by the Federal Reserve in December.
"The list of questionable actions credit card companies are engaged in is lengthy and disturbing," said Sen. Chris Dodd (D-CT) chairman of the banking committee, said during a hearing on the issue earlier this month.
Legislation introduced by Dodd and Sen. Carl Levin (D-MI) would also: prohibit credit card companies from charging interest on penalty fees; prohibit charging consumers to pay bills via mail or telephone; require card issuers to lower penalty interest rates if no further violations occur after six months; and require issuers soliciting anyone under 21 to get the signature of the parent or guardian who will co-sign for debt.
A credit card reform bill is also moving forward in the House.
Any new regulations would be in addition to a sweeping clampdown on the industry already adopted by the Fed, which take effect in July 2010, and shield cardholders from arbitrary interest rate hikes and inadequate time to pay bills.
