1.Short
title; table of contents
(a)This Act may be cited
as the Consumer Credit Safety
Commission Act of 2008
.
(b)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.
2.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.
3.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).
4.Establishment of
Commission
(a)Establishment;
chairperson
(1)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)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)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)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)
(1)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)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)Not more than 3 of the Commissioners shall be
affiliated with the same political party.
(2)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)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)The
Commission shall have an official seal of which judicial notice shall be
taken.
(3)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)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)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)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
appropriationsRequests 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 commentsAt 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.
5.Authorization of
appropriationsThere are
authorized to be appropriated for purposes of carrying out this Act such sums
as may be necessary.
6.Objectives and
responsibilities
(a)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)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.
7.Coordination of
enforcement
(a)Notwithstanding any concurrent or similar authority of
any other agency, the Commission shall enforce the requirements of this
Act.
(b)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)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)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.
8.
(a)Authority To
conduct hearings or other inquiriesThe 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; ordersThe 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; contemptAny 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
informationNo 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 dataThe 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 commissionFor 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)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 CongressWhenever 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
recommendationWhenever 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.
9.Collaboration
with Federal and State entities
(a)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 cooperationThe 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 agenciesThe 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.
10.Procedures and
rulemaking
(a)Commencement of
proceeding; publication of prescribed notice of proposed rulemaking;
transmittal of noticeA 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)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
standardIf 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; contentsNo
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)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)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)
(1)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)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)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)A
consumer credit safety rule shall express in the rule itself the objectives
identified in subsection (a)(1) with respect to such rule.
(2)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)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)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)The
Commission shall publish its final regulatory analysis with the rule.
(4)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)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 ruleThe 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 rulemakingThe 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.
11.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.
12.
(a)
(1)Knowing and
willful violationsAny 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)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)
(1)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 penaltiesNot 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 penaltyIn 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 penaltyAny 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 penaltiesThe 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.
13.
(a)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 CongressThe 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.
14.This Act shall be
effective 120 days after the date of enactment of this Act.