[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 3287 Introduced in Senate (IS)]







110th CONGRESS
  2d Session
                                S. 3287

 To amend the Truth in Lending Act to establish a national usury rate 
                   for consumer credit transactions.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 17, 2008

  Mr. Durbin introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
 To amend the Truth in Lending Act to establish a national usury rate 
                   for consumer credit transactions.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Protecting Consumers from 
Unreasonable Credit Rates Act of 2008''.

SEC. 2. NATIONAL MAXIMUM INTEREST RATE.

    Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et seq.) is 
amended by adding at the end the following:

``SEC. 140. MAXIMUM RATES OF INTEREST.

    ``(a) In General.--Notwithstanding any other provision of law, no 
creditor may make an extension of credit to a consumer with respect to 
which the annual percentage credit rate, as defined in subsection (b), 
exceeds 36 percent.
    ``(b) Annual Percentage Credit Rate Defined.--For purposes of this 
section, the annual percentage credit rate includes all charges payable 
directly or indirectly incident to, ancillary to, or as a condition of 
the extension of credit, including--
            ``(1) any payment compensating a creditor or prospective 
        creditor for an extension of credit or making available a line 
        of credit, or any default or breach by a borrower of a 
        condition upon which credit was extended, including fees 
        connected with credit extension or availability, such as 
        numerical periodic rates, late fees, excessive creditor-imposed 
        not sufficient funds fees charged when a borrower tenders 
        payment on a debt with a check drawn on insufficient funds, 
        over limit fees, annual fees, cash advance fees, and membership 
        fees;
            ``(2) all fees which constitute a finance charge, as 
        defined by rules of the Board in accordance with this title;
            ``(3) credit insurance premiums, whether optional or 
        required; and
            ``(4) all charges and costs for ancillary products sold in 
        connection with or incidental to the credit transaction.
    ``(c) Relation to State Law.--Nothing in this section may be 
construed to preempt any provision of State law that provides greater 
protection to consumers than is provided in this section.
    ``(d) Civil Liability and Enforcement.--In addition to remedies 
available to the consumer under section 130(a), any payment 
compensating a creditor or prospective creditor, to the extent that 
such payment is a transaction made in violation of this section, shall 
be null and void, and not enforceable by any party in any court or 
alternative dispute resolution forum, and the creditor or any 
subsequent holder shall promptly return to the consumer any principal, 
interest, charges, and fees, and any security interest associated with 
such transaction. Notwithstanding any statute of limitations or repose, 
a violation of this section may be raised as a matter of defense by 
recoupment or set off to an action to collect such debt or repossess 
related security at any time.
    ``(e) Violations.--Any person that violates this section, or seeks 
to enforce an agreement made in violation of this section, shall be 
subject to, for each such violation, 1 year in prison and a fine in an 
amount equal to the greater of--
            ``(1) 3 times the amount of the total accrued debt 
        associated with the subject transaction; or
            ``(2) $50,000.
    ``(f) State Attorneys General.--An action to enforce this section 
may be brought by the appropriate State attorney general in any United 
States district court or any other court of competent jurisdiction 
within 3 years from the date of the violation, and may obtain 
injunctive relief.''.
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