[Congressional Record Volume 155, Number 8 (Wednesday, January 14, 2009)]
[Senate]
[Pages S389-S390]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. SCHUMER (for himself and Mr. Udall of Colorado):
  S. 235. A bill to amend the Truth in Lending Act to establish fair 
and transparent practices relating to the extension of credit under an 
open end consumer credit plan, and for other purposes; to the Committee 
on Banking, Housing, and Urban Affairs.
  Mr. UDALL of Colorado. Mr. President, I am proud to introduce the 
Credit Cardholders' Bill of Rights today with my friend and colleague, 
Senator Charles Schumer. We are introducing this bill today as a way to 
add some commonsense rules to the laws governing the issuance of credit 
cards.
  Commonsense rules are important at a time when many Americans are 
hurting and taking on more debt, even as credit card companies are 
making record profits. I hear often from hard-working, honest 
Coloradans who are asking only to be treated fairly by the credit card 
industry, whose deceptive practices have plagued consumers for years.
  We need to act to bring greater fairness to the millions of Americans 
who need and use credit cards every day. I have heard from constituents 
across Colorado, asking me to help even the playing field on this 
issue.

[[Page S390]]

  They benefit from the widespread availability of consumer credit, and 
their use of that credit has been important to our economy. In fact, 
for many Americans, consumer credit is more than a convenience. It is 
something that many people need to use to pay for their everyday needs. 
For them, it is a necessity.
  Of course, another word for credit is debt, and credit card debt has 
increased considerably in recent years. Overall, during the last 
decade, total credit card debt rose by about 70 percent, and this 
clearly has an effect on consumers.
  Some polls have reported that about 70 percent of surveyed families 
said the quality of their lives is adversely affected by the extent of 
their debts, and young people are more worried about going deeply into 
debt than about a terrorist attack.
  Some have argued that much of this debt was caused by recklessness 
and an erosion of financial responsibility. That was one of the main 
arguments advanced in support of the recent changes in the bankruptcy 
laws.
  But while there was something to that argument, it was not the whole 
story and it put too much emphasis on borrowers alone. Instead of just 
focusing on borrowers, Congress should also do more to promote 
responsibility by those who provide the credit, and one place to start 
is with credit card companies.
  That is the reason I have been working to make some commonsense 
changes in the rules for credit card companies.
  I first introduced a bill to do that back in 2006, and reintroduced 
it again the following year. I am proud it won the support of an array 
of consumer groups as well as cosponsors from congressional districts 
across the country.
  Last year, the House passed H.R. 5244, the Credit Cardholders' Bill 
of Rights, a bill I introduced with Representative Carolyn Maloney, 
that includes many provisions based on my legislation.
  The bill I am introducing today with Senator Schumer is almost 
identical to the House-passed bill. It includes protection against 
arbitrary interest rate increases. It will prevent cardholders who pay 
on time from being unfairly penalized. It will bar excessive fees and 
will require more fairness in the way payments are handled. And it will 
prohibit the use of ``universal default'' clauses--provisions that 
allow card issuers to impose a new, higher interest rate on a credit 
card account if there has been any change for the worse in the 
cardholder's credit score--even if the change is unrelated to the 
credit card account.
  The passage of this legislation is made more urgent by our Nation's 
worsening financial crisis. I will work with Members of both parties to 
make these commonsense reforms and even the playing field for credit 
card consumers in Colorado and throughout the country.
                                 ______