Senator Snowe Lauds Senate Passage of Credit Card Reform Bill

Shields Consumers from Abusive Practices

May 19, 2009 -- Washington, D.C. -- U.S. Senator Olympia J. Snowe (R-Maine) today lauded Senate passage of the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009, legislation to prohibit the credit card industry from unfairly raising interest rates on consumers. The bipartisan measure passed the Senate by a vote of 90 to 5.

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"At a time when families in Maine and throughout the rest of the country are tightening their belts and adjusting household budgets to reflect the changes of the slowing economy, it is absurd to expect them to combat unexpected frivolous fees and arbitrary interest rate increases from credit card companies," said Senator Snowe, Ranking Member on the Senate Small Business Committee. "Although long overdue, today, the Senate approved critical legislation that will provide vital safeguards to consumer credit cards and finally put an end to the abusive practices of the industry."

The CARD Act tightens current credit card company regulations to help protect consumers from credit card abuses. Specifically, the legislation will: prohibit the credit card industry from arbitrarily raising interest rates on outstanding balances at any time for any reason; prevent "two-cycle" billing, where a company assesses interest not only on the balance for the current billing cycle, but also on the balance for days in the preceding billing cycle; block companies from applying the entirety of a payment to balances with the lowest interest rates; and, ensure customers have 21 days to pay a bill once it is sent so that they have sufficient time to make a payment.
tightens current credit card company regulations to help protect consumers from credit card abuses. Specifically the legislation will: prohibit the credit card industry from arbitrarily raising interest rates on outstanding balances at any time for any reason; prevent "two-cycle" billing, where a company assesses interest not only on the balance for the current billing cycle, but also on the balance for days in the preceding billing cycle; block companies from applying the entirety of a payment to balances with the lowest interest rates; and ensure customers have 21 days to pay a bill once it is sent so that they have sufficient time to make a payment.

During the Senate debate this week, Senators Snowe and Landrieu offered an amendment to the CARD Act to establish a Small Business Information Security Task Force within the Small Business Administration. The amendment, which passed the Senate by unanimous consent, aims to protect small businesses from computer hackers and other information security breaches. Specifically, the Task Force will create a clearinghouse of information, resources, and tools that will ease the complexity, confusion, and cost often associated with enhancing information security measures within a small business.

"Overall, this legislation packs a powerful punch that will aggressively rein in perverse credit card company practices and protect the financial well-being of American consumers," said Senator Snowe. "I stand ready to work with my colleagues to ensure this legislation is swiftly enacted into law."

Source: Senator Olympia J. Snowe