[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 3629 Introduced in Senate (IS)]







110th CONGRESS
  2d Session
                                S. 3629

     To create a new Consumer Credit Safety Commission, to provide 
  individual consumers of credit with better information and stronger 
   protections, and to provide sellers of consumer credit with more 
                         regulatory certainty.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

           September 26 (legislative day, September 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 create a new Consumer Credit Safety Commission, to provide 
  individual consumers of credit with better information and stronger 
   protections, and to provide sellers of consumer credit with more 
                         regulatory certainty.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Consumer Credit 
Safety Commission Act of 2008''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Definitions.
Sec. 4. Establishment of Commission.
Sec. 5. Authorization of appropriations.
Sec. 6. Objectives and responsibilities.
Sec. 7. Coordination of enforcement.
Sec. 8. Authorities.
Sec. 9. Collaboration with Federal and State entities.
Sec. 10. Procedures and rulemaking.
Sec. 11. Prohibited acts.
Sec. 12. Penalties for violations.
Sec. 13. Reports.
Sec. 14. Effective date.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) the Nation's multi-agency financial services regulatory 
        structure has created a dispersion of regulatory 
        responsibility, which in turn has led to an inadequate focus on 
        protecting consumers from inappropriate consumer credit 
        practices;
            (2) the absence of appropriate oversight has allowed 
        excessively costly or predatory consumer credit products to 
        flourish; and
            (3) the creation of a regulator whose sole focus is the 
        safety of consumer credit products would help address this lack 
        of consumer protection.

SEC. 3. DEFINITIONS.

    For purposes of this Act--
            (1) the term ``consumer credit'' includes--
                    (A) any payment compensating a creditor or 
                prospective creditor, or an agent or affiliate thereof, 
                for an extension of credit or making available a line 
                of credit;
                    (B) any fees connected with credit extension or 
                availability, such as numerical periodic rates, late 
                fees, 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, or membership fees;
                    (C) any fees which constitute a finance charge;
                    (D) credit insurance premiums;
                    (E) all charges and costs for ancillary products 
                sold in connection with or incidental to the credit 
                transaction; and
                    (F) any direct or indirect fee, cost, or charge 
                incurred in, in connection with, or ancillary to a 
                consumer payment system, including but not exclusive to 
                merchant discount fees, interchange fees, debit card 
                fees, check-writing fees, automated clearinghouse fees, 
                payment-by-phone fees, internet payment intermediary 
                fees, and remote deposit capture fees;
            (2) the term ``relevant congressional committees'' means 
        the Committee on Banking, Housing, and Urban Affairs and the 
        Subcommittee on Financial Services and General Government of 
        the Committee on Appropriations of the Senate, and the 
        Committee on Financial Services and the Subcommittee on 
        Financial Services and General Government of the Committee on 
        Appropriations of the House of Representatives, and any 
        successor committees as may be constituted;
            (3) the term ``creditor'' has the same meaning as in 
        section 103 of the Truth in Lending Act (15 U.S.C. 1602);
            (4) the term ``finance charge'' has the same meaning as in 
        section 106 of the Truth in Lending Act (15 U.S.C. 1605); and
            (5) the term ``consumer'' means any natural person and any 
        small business concern, as defined in section 3 of the Small 
        Business Act (15 U.S.C. 632).

SEC. 4. ESTABLISHMENT OF COMMISSION.

    (a) Establishment; Chairperson.--
            (1) In general.--An independent regulatory commission is 
        hereby established, to be known as the ``Consumer Credit Safety 
        Commission'' (in this Act referred to as the ``Commission''), 
        consisting of 5 Commissioners appointed by the President, by 
        and with the advice and consent of the Senate.
            (2) Membership.--In making appointments to the Commission, 
        the President shall consider individuals who, by reason of 
        their background and expertise in areas related to consumer 
        credit, are qualified to serve as members of the Commission.
            (3) Chairperson.--The Chairperson shall be appointed by the 
        President, by and with the advice and consent of the Senate, 
        from among the members of the Commission. An individual may 
        serve as a member of the Commission and as Chairperson at the 
        same time.
            (4) Removal.--Any member of the Commission may be removed 
        by the President for neglect of duty or malfeasance in office, 
        but for no other cause.
    (b) Term; Vacancies.--
            (1) In general.--Except as provided in paragraph (2)--
                    (A) the Commissioners first appointed under this 
                section shall be appointed for terms ending 3, 4, 5, 6, 
                and 7 years, respectively, after the date of enactment 
                of this Act, the term of each to be designated by the 
                President at the time of nomination; and
                    (B) each of their successors shall be appointed for 
                a term of 5 years from the date of the expiration of 
                the term for which the predecessor was appointed.
            (2) Limitations.--Any Commissioner appointed to fill a 
        vacancy occurring prior to the expiration of the term for which 
        his predecessor was appointed shall be appointed only for the 
        remainder of such term. A Commissioner may continue to serve 
        after the expiration of this term until a successor has taken 
        office, except that such Commissioner may not continue to serve 
        more than 1 year after the date on which the term of that 
        Commissioner would otherwise expire under this subsection.
    (c) Restrictions on Outside Activities.--
            (1) Political affiliation.--Not more than 3 of the 
        Commissioners shall be affiliated with the same political 
        party.
            (2) Conflicts of interest.--No individual may hold the 
        office of Commissioner if that individual--
                    (A) is in the employ of, or holding any official 
                relation to, or married to any person engaged in 
                selling or devising consumer credit;
                    (B) owns stock or bonds of substantial value in a 
                person so engaged;
                    (C) is in any other manner pecuniarily interested 
                in such a person, or in a substantial supplier of such 
                a person; or
                    (D) engages in any other business, vocation, or 
                employment.
    (d) Quorum; Seal; Vice Chairperson.--
            (1) Quorum.--No vacancy in the Commission shall impair the 
        right of the remaining Commissioners to exercise all the powers 
        of the Commission, but 3 members of the Commission shall 
        constitute a quorum for the transaction of business, except 
        that if there are only 3 members serving on the Commission 
        because of vacancies in the Commission, 2 members of the 
        Commission shall constitute a quorum for the transaction of 
        business, and if there are only 2 members serving on the 
        Commission because of vacancies in the Commission, 2 members 
        shall constitute a quorum for the 6-month period (or the 1-year 
        period, if the 2 members are not affiliated with the same 
        political party) beginning on the date of the vacancy which 
        caused the number of Commission members to decline to 2.
            (2) Seal.--The Commission shall have an official seal of 
        which judicial notice shall be taken.
            (3) Vice chairperson.--The Commission shall annually elect 
        a Vice Chairperson to act in the absence or disability of the 
        Chairperson or in case of a vacancy in the office of the 
        Chairperson.
    (e) Offices.--The Commission shall maintain a principal office and 
such field offices as it deems necessary, and may meet and exercise any 
of its powers at any other place.
    (f) Functions of Chairperson; Request for Appropriations.--
            (1) Duties.--The Chairperson of the Commission shall be the 
        principal executive officer of the Commission, and shall 
        exercise all of the executive and administrative functions of 
        the Commission, including functions of the Commission with 
        respect to--
                    (A) the appointment and supervision of personnel 
                employed under the Commission (and the Commission shall 
                fix their compensation at a level comparable to that 
                for employees of the Securities and Exchange 
                Commission);
                    (B) the distribution of business among personnel 
                appointed and supervised by the Chairperson and among 
                administrative units of the Commission; and
                    (C) the use and expenditure of funds.
            (2) Governance.--In carrying out any of the functions of 
        the Chairperson under this subsection, the Chairperson shall be 
        governed by general policies of the Commission and by such 
        regulatory decisions, findings, and determinations as the 
        Commission may, by law, be authorized to make.
            (3) Requests for appropriations.--Requests or estimates for 
        regular, supplemental, or deficiency appropriations on behalf 
        of the Commission may not be submitted by the Chairperson 
        without the prior approval of the Commission.
    (g) Agenda and Priorities; Establishment and Comments.--At least 30 
days before the beginning of each fiscal year, the Commission shall 
establish an agenda for Commission action under its jurisdiction and, 
to the extent feasible, shall establish priorities for such actions. 
Before establishing such agenda and priorities, the Commission shall 
conduct a public hearing on the agenda and priorities, and shall 
provide reasonable opportunity for the submission of comments.

SEC. 5. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated for purposes of carrying 
out this Act such sums as may be necessary.

SEC. 6. OBJECTIVES AND RESPONSIBILITIES.

    (a) Objectives.--The objectives of the Commission are--
            (1) to minimize unreasonable consumer risk associated with 
        buying and using consumer credit;
            (2) to prevent and eliminate unfair practices that lead 
        consumers to incur unreasonable, inappropriate, or excessive 
        debt, or make it difficult for consumers to escape existing 
        debt, including practices or product features that are abusive, 
        fraudulent, unfair, deceptive, predatory, anticompetitive, or 
        otherwise inconsistent with consumer protection;
            (3) to promote practices that assist and encourage 
        consumers to use credit responsibly, avoid excessive debt, and 
        avoid unnecessary or excessive charges derived from or 
        associated with credit products;
            (4) to ensure that credit history is maintained, reported, 
        and used fairly and accurately;
            (5) to maintain strong privacy protections for consumer 
        credit transactions, credit history, and other personal 
        information associated with the use of consumer credit;
            (6) to collect, investigate, resolve, and inform the public 
        about consumer complaints regarding consumer credit;
            (7) to ensure a fair system of consumer dispute resolution 
        in consumer credit; and
            (8) to take such other steps as are reasonable to protect 
        consumers of credit products.
    (b) Responsibilities.--The Commission shall--
            (1) promulgate consumer credit safety rules that--
                    (A) ban abusive, fraudulent, unfair, deceptive, 
                predatory, anticompetitive, or otherwise anti-consumer 
                practices or product features for creditors;
                    (B) place reasonable restrictions on consumer 
                credit practices or product features to reduce the 
                likelihood that they may be provided in a manner that 
                is inconsistent with the objectives specified in 
                subsection (a); and
                    (C) establish requirements for such clear and 
                adequate warnings or other information, and the form of 
                such warnings or other information, as may be 
                appropriate to advance the objectives specified in 
                subsection (a);
            (2) establish and maintain a best practices guide for all 
        providers of consumer credit;
            (3) conduct such continuing studies and investigations of 
        consumer credit industry practices as it deems necessary;
            (4) award grants or enter into contracts for the conduct of 
        such studies and investigations with any person (including a 
        governmental entity);
            (5) following publication of an advance notice of proposed 
        rulemaking, a notice of proposed rulemaking, or a rule under 
        any rulemaking authority administered by the Commission, assist 
        public and private organizations or groups of consumer credit 
        providers, administratively and technically, in the development 
        of consumer credit safety standards or guidelines that would 
        assist such providers in complying with such rule; and
            (6) establish and operate a consumer credit customer 
        hotline which consumers can call to register complaints and 
        receive information on how to combat anti-consumer consumer 
        credit.

SEC. 7. COORDINATION OF ENFORCEMENT.

    (a) In General.--Notwithstanding any concurrent or similar 
authority of any other agency, the Commission shall enforce the 
requirements of this Act.
    (b) Rule of Construction.--The authority granted to the Commission 
to make and enforce rules under this Act shall not be construed to 
impair the authority of any other Federal agency to make and enforce 
rules under any other provision of law, provided that any portion of 
any rule promulgated by any other such agency that conflicts with a 
rule promulgated by the Commission and that is less protective of 
consumers than the rule promulgated by the Commission shall be 
superseded by the stronger rule promulgated by the Commission, to the 
extent of the conflict. Any portion of any rule promulgated by any 
other such agency that is not superseded by a rule promulgated by the 
Commission shall remain in force without regard to this Act.
    (c) Agency Authority.--Any agency designated in subsection (d) may 
exercise, for the purpose of enforcing compliance with any requirement 
imposed under this Act, any authority conferred on such agency by any 
other Act.
    (d) Designated Agencies.--The agencies designated in this 
subsection are--
            (1) the Board of Governors of the Federal Reserve System;
            (2) the Federal Deposit Insurance Corporation;
            (3) the Office of the Comptroller of the Currency;
            (4) the Office of Thrift Supervision;
            (5) the National Credit Union Administration;
            (6) the Federal Housing Finance Authority;
            (7) the Federal Housing Administration;
            (8) the Secretary of Housing and Urban Development;
            (9) the Federal Home Loan Bank Board; and
            (10) the Federal Trade Commission.

SEC. 8. AUTHORITIES.

    (a) Authority To Conduct Hearings or Other Inquiries.--The 
Commission may, by one or more of its members or by such agents or 
agency as it may designate, conduct any hearing or other inquiry 
necessary or appropriate to its functions anywhere in the United 
States. A Commissioner who participates in such a hearing or other 
inquiry shall not be disqualified solely by reason of such 
participation from subsequently participating in a decision of the 
Commission in the same matter. The Commission shall publish notice of 
any proposed hearing in the Federal Register, and shall afford a 
reasonable opportunity for interested persons to present relevant 
testimony and data.
    (b) Commission Powers; Orders.--The Commission shall have the 
power--
            (1) to require, by special or general orders, any person to 
        submit in writing such reports and answers to questions as the 
        Commission may prescribe to carry out a specific regulatory or 
        enforcement function of the Commission, and such submission 
        shall be made within such reasonable period and under oath or 
        otherwise as the Commission may determine, and such order shall 
        contain a complete statement of the reasons that the Commission 
        requires the report or answers specified in the order to carry 
        out a specific regulatory or enforcement function of the 
        Commission, and shall be designed to place the least burden on 
        the person subject to the order as is practicable, taking into 
        account the purpose for which the order was issued;
            (2) to administer oaths;
            (3) to require by subpoena the attendance and testimony of 
        witnesses and the production of all documentary evidence 
        relating to the execution of its duties;
            (4) in any proceeding or investigation to order testimony 
        to be taken by deposition before any person who is designated 
        by the Commission and has the power to administer oaths and, in 
        such instances, to compel testimony and the production of 
        evidence in the same manner as authorized under paragraph (3);
            (5) to pay witnesses the same fees and mileage as are paid 
        in like circumstances in the courts of the United States;
            (6) to accept voluntary and uncompensated services relevant 
        to the performance of the Commission's duties, notwithstanding 
        the provisions of section 1342 of title 31, United States Code, 
        and to accept voluntary and uncompensated services (but not 
        gifts) relevant to the performance of the Commission's duties, 
        provided that any such services shall not be from parties that 
        have or are likely to have business before the Commission;
            (7) to--
                    (A) initiate, prosecute, defend, intervene in, or 
                appeal (other than to the Supreme Court of the United 
                States), through its own legal representative and in 
                the name of the Commission, any civil action if the 
                Commission makes a written request to the Attorney 
                General of the United States for representation in such 
                civil action and the Attorney General does not within 
                the 45-day period beginning on the date such request 
                was made notify the Commission in writing that the 
                Attorney General will represent the Commission in such 
                civil action; and
                    (B) whenever the Commission obtains evidence that 
                any person, partnership, or corporation, either 
                domestic or foreign, has engaged in conduct that may 
                constitute a violation of Federal criminal law, 
                including a violation of section 11 of this Act, 
                transmit such evidence to the Attorney General of the 
                United States, who may institute criminal proceedings 
                under appropriate statutes; and
            (8) to delegate any of its functions or powers, other than 
        the power to issue subpoenas under paragraph (3), to any 
        officer or employee of the Commission.
    (c) Noncompliance With Subpoena or Commission Order; Contempt.--Any 
United States district court within the jurisdiction of which any 
inquiry is carried on, may, upon petition by the Commission (subject to 
subsection (b)(7)) or by the Attorney General of the United States, in 
case of refusal to obey a subpoena or order of the Commission issued 
under subsection (b), issue an order requiring compliance therewith. 
Any failure to obey the order of the court may be punished by the court 
as a contempt thereof.
    (d) Disclosure of Information.--No person shall be subject to civil 
liability to any person (other than the Commission or the United 
States) for disclosing information to the Commission.
    (e) Customer and Revenue Data.--The Commission may by rule require 
any provider of consumer credit to provide to the Commission such 
customer and revenue data as may be required to carry out the purposes 
of this Act.
    (f) Purchase of Consumer Credit by Commission.--For purposes of 
carrying out this Act, the Commission may purchase any consumer credit, 
and it may require any provider of consumer credit to sell the service 
to the Commission at cost.
    (g) Contract Authority.--The Commission is authorized to enter into 
contracts with governmental entities, private organizations, or 
individuals for the conduct of activities authorized by this Act.
    (h) Budget Estimates and Requests; Legislative Recommendations; 
Testimony; Comments on Legislation.--
            (1) Budget copies to congress.--Whenever the Commission 
        submits any budget estimate or request to the President or the 
        Office of Management and Budget, it shall concurrently transmit 
        a copy of that estimate or request to the relevant 
        congressional committees.
            (2) Legislative recommendation.--Whenever the Commission 
        submits any legislative recommendations, or testimony, or 
        comments on legislation to the President or the Office of 
        Management and Budget, it shall concurrently transmit a copy 
        thereof to the relevant congressional committees. No officer or 
        agency of the United States shall have any authority to require 
        the Commission to submit its legislative recommendations, or 
        testimony, or comments on legislation, to any officer or agency 
        of the United States for approval, comments, or review, prior 
        to the submission of such recommendations, testimony, or 
        comments to the relevant congressional committees.

SEC. 9. COLLABORATION WITH FEDERAL AND STATE ENTITIES.

    (a) Preemption.--Nothing in this Act or any rule promulgated 
thereunder may be construed to preempt any provision of State law that 
provides equal or greater protection to consumers than is provided in 
this Act.
    (b) Programs To Promote Federal-State Cooperation.--The Commission 
shall establish a program to promote Federal-State cooperation for the 
purposes of carrying out this Act. In implementing such program, the 
Commission may--
            (1) accept from any State or local authority engaged in 
        activities relating to consumer credit protection assistance in 
        such functions as data collection, investigation, and 
        educational programs, as well as other assistance in the 
        administration and enforcement of this Act which such States or 
        localities may be able and willing to provide and, if so 
        agreed, may pay in advance or otherwise for the reasonable cost 
        of such assistance; and
            (2) commission any qualified officer or employee of any 
        State or local agency as an officer of the Commission for the 
        purpose of conducting investigations.
    (c) Cooperation of Federal Departments and Agencies.--The 
Commission may obtain from any Federal department or agency such 
statistics, data, program reports, and other materials as it may deem 
necessary to carry out its functions under this Act. Each such 
department or agency shall cooperate with the Commission and, to the 
extent permitted by law, furnish such materials to it. The Commission 
and the heads of other departments and agencies engaged in 
administering programs related to consumer credit safety shall, to the 
maximum extent practicable, cooperate and consult in order to ensure 
fully coordinated efforts.

SEC. 10. PROCEDURES AND RULEMAKING.

    (a) Commencement of Proceeding; Publication of Prescribed Notice of 
Proposed Rulemaking; Transmittal of Notice.--A proceeding for the 
development of a consumer credit safety rule shall be commenced by the 
publication in the Federal Register of an advance notice of proposed 
rulemaking which shall--
            (1) identify the objective or objectives specified in 
        section 6(a) for the consumer credit safety rule;
            (2) include a summary of each of the regulatory 
        alternatives under consideration by the Commission;
            (3) include information with respect to any existing 
        voluntary standard known to the Commission which may be 
        relevant to the proceedings, together with a summary of the 
        reasons why the Commission believes preliminarily that such 
        standard does not achieve an objective identified in paragraph 
        (1);
            (4) invite interested persons to submit to the Commission, 
        within such period as the Commission shall specify in the 
        notice (which period shall not be shorter than 30 days or 
        longer than 60 days after the date of publication of the 
        notice), comments with respect to the proposed rulemaking, the 
        regulatory alternatives being considered, and other possible 
        alternatives for achieving the objective or objectives 
        identified in paragraph (1); and
            (5) invite any person (other than the Commission) to submit 
        to the Commission, within such period as the Commission shall 
        specify in the notice (which period shall not be less than 30 
        days after the date of publication of the notice), an existing 
        voluntary standard or a portion of such a standard as a 
        proposed consumer credit safety rule.
    (b) Transmittal to Congress.--The Commission shall transmit such 
notice within 10 calendar days to the relevant congressional 
committees.
    (c) Voluntary Standard; Publication as Proposed Rule; Notice of 
Reliance of Commission on Standard.--If the Commission determines that 
any standard submitted to it in response to an invitation in a notice 
published under subsection (a)(5) if promulgated (in whole, in part, or 
in combination with any other standard submitted to the Commission or 
any part of such a standard) as a consumer credit safety rule, would 
achieve the objective or objectives identified in paragraph (1), the 
Commission may publish such standard, in whole, in part, or in such 
combination and with nonmaterial modifications, as a proposed consumer 
credit safety rule.
    (d) Publication of Proposed Rule; Preliminary Regulatory Analysis; 
Contents.--No consumer credit safety rule may be proposed by the 
Commission unless, not later than 60 days after the date of publication 
of the notice required in subsection (a), the Commission publishes in 
the Federal Register the text of the proposed rule, including any 
alternatives, which the Commission proposes to promulgate, together 
with a preliminary regulatory analysis containing--
            (1) a preliminary description of the potential benefits and 
        potential costs of the proposed rule, including any benefits or 
        costs that cannot be quantified in monetary terms, and an 
        identification of those likely to receive the benefits and bear 
        the costs;
            (2) a discussion of the reasons any standard or portion of 
        a standard submitted to the Commission under subsection (a)(5) 
        was not published by the Commission as the proposed rule or 
        part of the proposed rule; and
            (3) a description of any reasonable alternatives to the 
        proposed rule, together with a summary description of their 
        potential costs and benefits, and a brief explanation of why 
        such alternatives should not be published as a proposed rule.
    (e) Transmittal of Notice.--The Commission shall transmit such 
notice not later than 10 calendar days after the date of publication of 
the notice to the relevant congressional committees.
    (f) Final Issuance.--Any proposed consumer credit safety rule shall 
be issued within 12 months after the date of publication of an advance 
notice of proposed rulemaking under subsection (a) relating to the 
consumer credit involved, unless the Commission determines that such 
proposed rule is not a reasonable means of achieving the objective or 
objectives identified in subsection (a)(1) with respect to such 
proposed rule or an objective specified in section 6(a), or is not in 
the public interest. The Commission may extend that 12-month period for 
good cause. If the Commission extends such period, it shall immediately 
transmit notice of such extension to the relevant congressional 
committees. Such notice shall include an explanation of the reasons for 
such extension, together with an estimate of the date by which the 
Commission anticipates such rulemaking will be completed. The 
Commission shall publish a notice of such extension and the information 
submitted to the Congress in the Federal Register.
    (g) Promulgation of Rule.--
            (1) Timing.--Not later than 60 days after the date of 
        publication under subsection (c) of a proposed consumer credit 
        safety rule, the Commission shall--
                    (A) promulgate a consumer credit safety rule, if it 
                makes the findings required under subsection (h); or
                    (B) withdraw the applicable notice of proposed 
                rulemaking if it determines that such rule is not--
                            (i) a reasonable means of achieving the 
                        objective or objectives identified in 
                        subsection (a)(1) with respect to such proposed 
                        rule or an objective specified in section 6(a); 
                        or
                            (ii) in the public interest.
            (2) Extension.--The Commission may extend such 60-day 
        period in paragraph (1) for good cause shown (if it publishes 
        its reasons therefore in the Federal Register).
            (3) Title 5.--Consumer credit safety rules shall be 
        promulgated in accordance with section 553 of title 5, United 
        States Code, except that the Commission shall give interested 
        persons an opportunity for the oral presentation of data, 
        views, or arguments, in addition to an opportunity to make 
        written submissions. A transcript shall be kept of any oral 
        presentation.
    (h) Expression of Objective; Consideration of Available Product 
Data; Needs of Elderly and Handicapped.--
            (1) Objectives.--A consumer credit safety rule shall 
        express in the rule itself the objectives identified in 
        subsection (a)(1) with respect to such rule.
            (2) Considerations.--In promulgating such a rule, the 
        Commission shall--
                    (A) consider relevant available data, including the 
                results of investigation activities conducted generally 
                and pursuant to this Act; and
                    (B) consider and take into account the special 
                needs of elderly individuals and individuals with 
                disabilities to determine the extent to which such 
                persons may be affected by such rule.
    (i) Findings; Final Regulatory Analysis; Judicial Review of Rule.--
            (1) Findings.--Prior to promulgating a consumer credit 
        safety rule, the Commission shall consider, and shall make 
        appropriate findings for inclusion in such rule with respect 
        to--
                    (A) the degree and nature of the benefit to 
                consumer protection that the rule is designed to 
                achieve or promote;
                    (B) the approximate number of consumer credit 
                products, or types or classes thereof, subject to such 
                rule;
                    (C) the need of the public for the consumer credit 
                product subject to such rule, and the probable effect 
                of such rule upon the utility, cost, or availability of 
                such services to meet such need; and
                    (D) any means of achieving the objective of the 
                order while minimizing adverse effects on competition 
                or disruption or dislocation of the provision of 
                consumer credit.
            (2) Regulatory analysis.--The Commission shall not 
        promulgate a consumer credit safety rule, unless it--
                    (A) has prepared, on the basis of the findings of 
                the Commission under paragraph (1) and on other 
                information before the Commission, a final regulatory 
                analysis of the rule containing--
                            (i) a description of the potential benefits 
                        and potential costs of the rule, including 
                        costs and benefits that cannot be quantified in 
                        monetary terms, and the identification of those 
                        likely to receive the benefits and bear the 
                        costs;
                            (ii) a description of any alternatives to 
                        the final rule which were considered by the 
                        Commission, together with a brief explanation 
                        of the reasons why these alternatives were not 
                        chosen; and
                            (iii) a summary of any significant issues 
                        raised by the comments submitted during the 
                        public comment period in response to the 
                        preliminary regulatory analysis, and a summary 
                        of the assessment by the Commission of such 
                        issues;
                    (B) finds (and includes such finding in the rule)--
                            (i) that the rule (including its effective 
                        date) is reasonably appropriate to achieve an 
                        objective identified in subsection (a)(1) with 
                        respect to such proposed rule or specified in 
                        section 6(a);
                            (ii) that the promulgation of the rule is 
                        in the public interest; and
                            (iii) that the benefits expected from the 
                        rule bear a reasonable relationship to its 
                        costs.
            (3) Publication.--The Commission shall publish its final 
        regulatory analysis with the rule.
            (4) Limit on judicial review.--Any preliminary or final 
        regulatory analysis prepared under subsection (c) or (i)(2) 
        shall not be subject to independent judicial review, except 
        that when an action for judicial review of a rule is 
        instituted, the contents of any such regulatory analysis shall 
        constitute part of the whole rulemaking record of agency action 
        in connection with such review. The provisions of this 
        paragraph shall not be construed to alter the substantive or 
        procedural standards otherwise applicable to judicial review of 
        any action by the Commission.
    (j) Effective Date.--Each consumer credit safety rule shall specify 
the date on which such rule is to take effect, not to exceed 180 days 
from the date on which it is issued in final form, unless the 
Commission finds, for good cause shown, that a later effective date is 
in the public interest and publishes its reasons for such finding. The 
effective date of a consumer credit safety rule under this Act shall be 
set at a date that is at least 30 days after the date of issuance in 
final form, unless the Commission for good cause shown determines that 
an earlier effective date is in the public interest. In no case may the 
effective date be set at a date which is earlier than the date of 
issuance in final form.
    (k) Amendment or Revocation of Rule.--The Commission may, by rule, 
amend or revoke any consumer credit safety rule. Such amendment or 
revocation shall specify the date on which it is to take effect, which 
shall not exceed 180 days from the date on which the amendment or 
revocation is published, unless the Commission finds for good cause 
shown that a later effective date is in the public interest and 
publishes its reasons for such finding. Where an amendment involves a 
material change in a consumer credit safety rule, subsections (a) 
through (h) shall apply. In order to revoke a consumer credit safety 
rule, the Commission shall publish a proposal to revoke such rule in 
the Federal Register, and allow oral and written presentations in 
accordance with subsection (d)(2). The Commission may revoke such rule 
only if it determines that the rule is not a reasonable means of 
achieving an objective identified in subsection (a)(1) with respect to 
such proposed rule or an objective specified in subsection 6(a).
    (l) Petition To Initiate Rulemaking.--The Commission shall grant, 
in whole or in part, or deny any petition under section 553 (e) of 
title 5, United States Code, requesting the Commission to initiate a 
rulemaking, within a reasonable time after the date on which such 
petition is filed. The Commission shall state the reasons for granting 
or denying such petition.

SEC. 11. PROHIBITED ACTS.

    It shall be unlawful for any person--
            (1) to advertise for or offer for sale any consumer credit 
        which is not in conformity with an applicable consumer credit 
        safety rule under this Act;
            (2) to advertise for or offer for sale any consumer 
        credit--
                    (A) which has been declared a banned product by a 
                rule under this Act;
                    (B) in a manner that does not comply with any 
                requirements for the provision of any warnings or other 
                information regarding such credit; or
            (3) to fail or refuse to permit access to or copying of 
        records, or fail or refuse to establish or maintain records, or 
        fail or refuse to make reports or provide information to the 
        Commission as required under this Act or any rule thereunder, 
        other than section 9.

SEC. 12. PENALTIES FOR VIOLATIONS.

    (a) Criminal Penalties.--
            (1) Knowing and willful violations.--Any person who 
        knowingly and willfully violates section 11 after having 
        received notice of noncompliance from the Commission shall be 
        fined not more than $500,000 or be imprisoned not more than one 
        year, or both.
            (2) Executives and agents.--Any individual director, 
        officer, or agent of a corporation who knowingly and willfully 
        authorizes, orders, or performs any of the acts or practices 
        constituting in whole or in part a violation of section 11, and 
        who has knowledge of notice of noncompliance received by the 
        corporation from the Commission, shall be subject to penalties 
        under this section, without regard to any penalties to which 
        that corporation may be otherwise subject.
    (b) Civil Penalties.--
            (1) In general.--Any person who violates section 11 shall 
        be subject to a civil penalty to be established at the 
        discretion of the Commission. A violation of section 11 shall 
        constitute a separate civil offense with respect to each 
        consumer credit transaction involved.
            (2) Publication of schedule of penalties.--Not later than 
        December 1, 2009, and December 1 of each fifth calendar year 
        thereafter, the Commission shall prescribe and publish in the 
        Federal Register a schedule of maximum authorized penalties 
        that shall apply for violations that occur after January 1 of 
        the year immediately following such publication.
            (3) Relevant factors in determining amount of penalty.--In 
        determining the amount of any penalty to be sought upon 
        commencing an action seeking to assess a penalty for a 
        violation of section 11, the Commission shall consider the 
        nature of the consumer credit product or service, the severity 
        of the unreasonable risk to the consumer, the number of 
        products or services sold or distributed, and the 
        appropriateness of such penalty in relation to the size of the 
        business of the person charged.
            (4) Compromise of penalty; deductions from penalty.--Any 
        civil penalty under this section may be compromised by the 
        Commission. In determining the amount of such penalty or 
        whether it should be remitted or mitigated and in what amount, 
        the Commission shall consider the appropriateness of such 
        penalty to the size of the business of the person charged, the 
        nature of the consumer credit, the severity of the unreasonable 
        risk to the consumer, the occurrence or absence of consumer 
        injury, and the number of offending products or services sold. 
        The amount of such penalty when finally determined, or the 
        amount agreed on compromise, may be deducted from any sums 
        owing by the United States to the person charged.
    (c) Collection and Use of Penalties.--The Commission shall retain 
ownership over criminal and civil fees collected and shall apply these 
fees to defray the costs of the Commission's operation or, where 
appropriate, provide restitution for harmed consumers.

SEC. 13. REPORTS.

    (a) Reports to the Public.--The Commission shall determine what 
reports should be produced and distributed to the public on a recurring 
and ad hoc basis, and shall prepare and publish such reports on a web 
site that provides free access to the general public.
    (b) Report to President and Congress.--The Commission shall prepare 
and submit to the President and the relevant congressional committees 
at the beginning of each regular session of Congress a comprehensive 
report on the administration of this Act for the preceding fiscal year. 
Such report shall include--
            (1) a thorough appraisal, including statistical analyses, 
        estimates, and long-term projections, of the incidence and 
        effects of practices associated with the provision of consumer 
        credit that are inconsistent with the objectives specified in 
        section 6(a), with a breakdown, insofar as practicable, among 
        the various sources of injury as the Commission finds 
        appropriate;
            (2) a list of consumer credit safety rules prescribed or in 
        effect during such year;
            (3) an evaluation of the degree of observance of consumer 
        credit safety rules, including a list of enforcement actions, 
        court decisions, and compromises of civil penalties, by 
        location and company name;
            (4) a summary of outstanding problems confronting the 
        administration of this Act in order of priority;
            (5) an analysis and evaluation of public and private 
        consumer credit safety research activities;
            (6) a list, with a brief statement of the issues, of 
        completed or pending judicial actions under this Act;
            (7) the extent to which technical information was 
        disseminated to the scientific and consumer credit communities 
        and consumer information was made available to the public;
            (8) the extent of cooperation between Commission officials 
        and representatives of industry and other interested parties in 
        the implementation of this Act, including a log or summary of 
        meetings held between Commission officials and representatives 
        of industry and other interested parties;
            (9) an appraisal of significant actions of State and local 
        governments relating to the responsibilities of the Commission;
            (10) with respect to voluntary consumer credit safety 
        standards promulgated as consumer safety rules under section 
        10(c), a description of--
                    (A) the number of such standards adopted as rules; 
                and
                    (B) the nature and number of the consumer credit 
                products and services which are the subject of such 
                adopted rules and the approximate number of consumers 
                affected;
            (11) such recommendations for additional legislation as the 
        Commission deems necessary to carry out the purposes of this 
        Act; and
            (12) the extent of cooperation with and the joint efforts 
        undertaken by the Commission in conjunction with other 
        regulators with whom the Commission shares responsibilities for 
        consumer credit safety.

SEC. 14. EFFECTIVE DATE.

    This Act shall be effective 120 days after the date of enactment of 
this Act.
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