William Ruberry, a spokesman for the Office of Thrift Supervision, said the agencies acted in part because of growing consumer complaints and heightened interest in Congress to rein in credit card companies. The OTC and the National Credit Union Administration joined the Federal Reserve in proposing the rules, which are expected to be finalized by the end of the year.
"There's a lot of interest in the rules by which credit cards are issued and there are some practices that consumer groups and members of Congress think are unfair, and we're trying to address those," Ruberry said.
Several bills are pending before Congress, including a credit cardholders "Bill of Rights" introduced by Rep. Carolyn B. Maloney, a New York Democrat.
Maloney said yesterday that she plans to press ahead with a reform bill, saying the Fed's proposed regulations will come too little, too late for the millions of consumers who need help now.
"More Americans are turning to their credit cards to help pay bills, buy groceries and make ends meet in this troubled economy," she said in a statement.
In testimony before Maloney's committee, banking industry officials complained such legislation, while well-meaning, could end up making credit more expensive.
"We've said in previous testimony on the Maloney bill that we remain concerned about the unintended consequences," said Betty Riess, a spokeswoman for Bank of America, which has a large consumer base in Maryland.
The bank declined to comment on the Fed's new regulations, saying that it needs time to review the proposals.
paul.adams@baltsun.com
Sun reporter Megan Hartley contributed to this article.
Proposed credit card regulations
Credit-card rules proposed by three agencies would prohibit:
Retroactively raising interest rates on pre-existing balances.
Charging unfair late fees. Rules would give borrowers at least 21 days to pay bills.
Allocating payments to low-interest rate balances first, carrying higher-rate balances into the next month.
Charging high fees for exceeding a credit limit because of a temporary hold on the account.
Charging high interest by computing monthly balances using double-cycle billing method.
Adding unfair security deposits and fees for making credit available.
The proposed rules would also require federal credit unions to give consumers a chance to opt out of an overdraft protection program.
[ Source: Associated Press; Office of Thrift Supervision]
