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Consumer Federation of America |
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Press Release |
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WASHINGTON - The Consumer Federation of America and Consumers Union,
publisher of Consumer Reports magazine, urged lawmakers to steer clear of
supporting a warmed-over version of the flawed bankruptcy bill that is being
hawked by the credit card industry.
The measure, being introduced today by Rep. George Gekas, R-Pa., mirrors
legislation rejected by the White House last year and doesn't deserve the
support of lawmakers who want to do right by consumers, according to CU's
legislative counsel Frank Torres and Mary Rouleau, CFA's legislative
director.
"This flawed approach is being pushed by those who want to please powerful
members of the credit card lobby," said Rouleau. "It fails consumers because it
leaves families in crisis stranded while giving credit card companies free reign
to continue to engage in misleading and coercive practices."
The Consumer Federation of America and Consumers Union support a balanced
approach that includes meaningful disclosures about the true price of credit and
proper protection from credit company abuses, according to Torres and Rouleau.
Other needed fixes are tight restrictions on marketing to minors who may have no
ability to repay, outlawing live checks and shutting down the practice of credit
card companies who cancel credit cards to consumers who pay off on time.
Giving wind to the consumer group's cause is a recent study from the American
Bankruptcy Institute that shows how bankrupt the credit card lobby's effort is.
Contrary to industry funded studies which claim large numbers of families and
individuals who face bankruptcy could repay their debts if they wanted to, the
ABI report shows that a mere three percent could fall into such a
category.
"There is a better way," Torres said. "Bankruptcy judges, trustees and other
bankruptcy experts have been working with the public interest community and
interested parties in Congress to craft a balanced approach. We urge lawmakers
to keep their powder dry until their proposals are fully considered and not
support this flawed bill being pushed on Congress by the credit card
lobby."
The Consumer Federation of America and Consumers Union are part of a large
coalition of organizations representing women and children, labor, and the civil
rights community concerned about the effect of extreme bankruptcy proposals on
women, children, and families.
