Released: August 10, 2008

Credit card industry faces reforms

Source: Nancy Trejos, Washington Post (Free Registration)

Stricter regulation of the credit card industry will probably be approved by the end of the year, consumer advocates, members of Congress and banking officials said as the comment period on the Federal Reserve’s proposed actions drew to a close last week.

Nearly 56,000 comments poured into the agency via e-mail and regular mail, a record response for any Fed proposal, said agency spokeswoman Susan Stawick.

Both the Fed and Congress are working to tighten rules on the credit card industry. The large response to the Fed’s proposal comes on the heels of congressional action on the issue. The House Financial Services Committee moved Rep. Carolyn B. Maloney’s Credit Cardholders’ Bill of Rights out of committee on July 31. The measure would prohibit unexpected increases in the rates charged on pre-existing credit card balances, among other things. Observers said the New York Democrat’s bill probably wouldn’t pass the Senate this year because time is running out.

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