[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 165 Introduced in Senate (IS)]

111th CONGRESS
  1st Session
                                 S. 165

To amend the Truth in Lending Act, to prevent credit card issuers from 
taking unfair advantage of college students and their parents, and for 
                            other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 7, 2009

 Mr. Kohl (for himself and 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 prevent credit card issuers from 
taking unfair advantage of college students and their parents, and for 
                            other purposes.

    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 ``Student Credit Card Protection Act 
of 2009''.

SEC. 2. ISSUANCE OF CREDIT CARDS TO CERTAIN COLLEGE STUDENTS.

    Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is amended 
by adding at the end the following new subsection:
    ``(i) Provisions Applicable With Regard to the Issuance of Credit 
Cards to Full-Time, Traditional-Aged College Students.--
            ``(1) Definitions.--For purposes of this section, the 
        following definitions shall apply:
                    ``(A) College student credit card account 
                defined.--For purposes of this subsection, the term 
                `college student credit card account' means a credit 
                card account under an open end consumer credit plan 
                established or maintained for or on behalf of any 
                college student.
                    ``(B) College student.--The term `college student' 
                means an individual--
                            ``(i) who is a full-time student attending 
                        an institution of higher education; and
                            ``(ii) who has not yet attained the age of 
                        21.
                    ``(C) Institution of higher education.--The term 
                `institution of higher education' has the same meaning 
                as in section 101(a) of the Higher Education Act of 
                1965 (20 U.S.C. 1001(a)).
            ``(2) Maximum amount limitation as a percentage of gross 
        income.--Unless a parent, legal guardian, or spouse of a 
        college student assumes joint liability for debts incurred by 
        the student in connection with a college student credit card 
        account--
                    ``(A) no creditor shall grant a college student a 
                credit card account where the credit limit for that 
                account exceeds, during a full calendar year, the 
                greater of--
                            ``(i) 20 percent of the annual gross income 
                        of the student; or
                            ``(ii) $500; and
                    ``(B) no creditor shall grant a student a credit 
                card account, if the credit limit for that credit card 
                account, combined with the credit limits of any other 
                credit card accounts held by the student, would exceed 
                30 percent of the annual gross income of the student in 
                the most recently completed calendar year.
            ``(3) Parental approval required to increase credit lines 
        for accounts for which parent is jointly liable.--No increase 
        may be made in the amount of credit authorized to be extended 
        under a college student credit card account for which a parent, 
        legal guardian, or spouse of the consumer has assumed joint 
        liability for debts incurred by the consumer in connection with 
        the account, before the consumer attains the age of 21, with 
        respect to such consumer, unless the parent, guardian, or 
        spouse of the consumer, as applicable, approves in writing, and 
        assumes joint liability for, such increase.
            ``(4) Income verification.--For purposes of this 
        subsection, a creditor shall require adequate proof of income, 
        income history, and credit history, subject to the rules of the 
        Board, before any college student credit card account may be 
        opened by or on behalf of a student.
            ``(5) Prohibition on more than 1 credit card account for 
        any college student.--No creditor may open a credit card 
        account for, or issue any credit card to, any college student 
        who--
                    ``(A) has no verifiable annual gross income; and
                    ``(B) already maintains a credit card account under 
                an open end consumer credit plan with that creditor, or 
                any affiliate thereof.
            ``(6) Exemption authority.--The Board may, by rule, provide 
        for exemptions to the provisions of this subsection, as deemed 
        necessary or appropriate by the Board, consistent with the 
        purposes of this subsection.''.

SEC. 3. REGULATIONS REQUIRED.

    Not later than 180 days after the date of enactment of this Act, 
the Board of Governors of the Federal Reserve System shall issue such 
rules as may be necessary to carry out section 127(i) of the Truth in 
Lending Act, as added by this Act.
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