Abuses have become more common as struggling families turn to credit cards to help make ends meet. The proposed rules increase transparency and help to ensure fairness for consumers and deposit account holders
Washington, DC (PRWEB) May 5, 2008
USHAA and the Green Agenda Coalition launch Credit Justice Petition to support proposal by Federal Reserve Chairman Ben S. Bernanke and bank regulators for a new set of rules protecting consumers from arbitrary rate increases by credit card companies and other abusive business practices such as concealing high penalty fees. Under the rules, credit card companies would need to give consumers more time to make payments before they are deemed overdue.
The new rules would prohibit lenders from (i) arbitrarily raising interest rates on any debt unless a promotional rate expires or the borrower was more than a month late in making a payment, (ii) classifying borrowers as "late" even if they didn't receive their statements at least 21 days in advance of the due date, (iii) calculating one month of fees based on two months' worth of activity, or (iv) allocating payments to lowest-rate balances first to maximize interest charges.
"The proposed rules are intended to establish a new baseline for fairness in how credit card plans operate," said Chairman Bernanke. "Consumers relying on credit cards should be better able to predict how their decisions and actions will affect their costs." The new rules also apply to fees and interest rates charged by savings associations for overdraft protection of checking accounts.
"Credit cards too often pose a potential to harm consumers rather than help them," added Senator Christopher J. Dodd, who has introduced legislation to reduce high credit card fees. "Confusing, misleading and in some cases predatory practices have become standard operating procedure for some in the credit card industry," explained Senator Dodd.
American low-income consumers, particularly Hispanics and other minorities, are disproportionately victimized by predatory lending and business practices. This is best illustrated by the mortgage crisis now rippling through Wall Street and the resulting Tsunami of foreclosures and bankruptcies. "Abuses have become more common as struggling families turn to credit cards to help make ends meet. The proposed rules increase transparency and help to ensure fairness for consumers and deposit account holders," said Alex Garcia, Chairman of The Green Agenda Coalition. For the above reasons, USHAA and The Green Agenda Coalition have joined forces to launch a national petition to support the proposed rules.
About USHAA: The United States Hispanic Advocacy Association ("USHAA") is the premier economic advocacy non-profit leveraging Hispanic purchasing power to provide effective advocacy, meaningful benefits and education programs to its members. We help ensure that Latinos receive economic benefits commensurate with their contributions to the American economy.
About Green Agenda Coalition: The Green Agenda Coalition, formerly the TriState Minority Community Reinvestment Coalition, is an East Coast-based multi-racial and multi-ethnic coalition of more than 140 organizations in the U.S. focused on economic advocacy, including without limitation, The Greenlining Institure, the Florida Minority Community Reinvestment Coalition, the New York State Federation of Hispanic Chambers of Commerce, USHAA, TELACU and other leading advocates. TGAC is led by its Chairman, Alex Garcia, RA, AICP, and Al Pina from FMCRC, who serves as Vice-Chairman.
Attn: Ms. Luz Cardenas
Two Penn Center Plaza
Philadelphia, PA 19102
Email: luz @ mycingular.blackberry.net