Federal Reserve Action Page

Tell the Bank Regulators Not To Back Down!
Finish the proposed rules banning unfair credit card practices.

Despite a wave of complaints about credit card companies from consumers, the powerful bank lobby has stopped reform in Congress by arguing “No, wait for the regulators.”

Now, the Federal Reserve Board and other regulators have shocked the banks by proposing strong rules to ban the worst unfair practices! We need your help to make sure that the regulators now follow through and make their rules final. Of course, the banks will now gear up their lobby machine. Only comments from the public can counteract the banks’ influence.

Write a short letter in the box below telling your credit card experience to the Federal Reserve. We will print out and deliver the letters. Note that we need a letter from you in your own words. We will print the content of your letters each week and drop them off at the Fed.

Your letter should urge the Fed not to weaken any of the strong proposals against unfair credit practices. Tell the story of any problem you had with a credit card company, especially if it relates to one of these five important issues:

No More Double-Cycle Billing: Some banks reach back a month, under a loophole in the Truth In Lending Act, and charge interest on amounts you already paid off last month. This practice, known as double cycle billing, would be banned.
No More Hair Trigger Rate Increases: Credit card companies could no longer raise your interest rate on existing or outstanding balances if your payment arrived a few days, or even an hour late. You’d need to be thirty days late before they could retroactively raise your rate. Hair trigger rate increases would be banned.
Click here to read three more consumer friendly actions that the Fed has proposed.

We also need your full name and address to deliver your letter.

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In Your Own Words

Why do we need a letter from you to the Federal Reserve in your own words? In its testimony to Congress last month, the Fed said that it had recently received “thousands” of individual consumer letters on previous credit card disclosure rules and that these made a big difference compared to identical, form letters that often come in. We agree.

Proposed Federal Reserve Rules

Here are three additional rules that the Federal Reserve has proposed. Your letter can tell the story of any problem you had with a credit card company related to any of these or other issues.

No Retroactive Rate Increase Under Universal Default: Credit card companies could no longer raise your interest rate on existing or outstanding balances by saying that even though you’d always paid your credit card bill on time, you’d either opened another an account somewhere (even if paid on time) or allegedly paid another creditor late. (This is called universal default and would be banned.)
No More Double-Cycle Billing: Some banks reach back a month, under a loophole in the Truth In the Truth In Lending Act, and charge interest on amounts you already paid off last month. This practice, known as double cycle billing, would be banned.
No More Unfair Payment Allocation: Banks would be banned from the current practice of applying your entire payment only to the portion of your balance with the lowest interest rate. Some consumers have a zero percent balance transfer and a 12% APR for purchases. Some may also have cash advances at an even higher rate of 20% APR or more. Under the new rule, in general your payment would be allocated either to the highest interest balance first, or divided proportionally.

In addition, you can read highlights of the Proposed Rules on Unfair and Deceptive Credit Card Practices at the Fed website.