Credit Card Reform

Support the Consumer Financial Protection Agency Without Weaking State Protections

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Why do we need State consumer protection laws, once we have the Consumer Financial Protection Agency (CFPA)?

States must be able to address problems within their borders, before they become nation-wide problems. Purely local problems do not need national legislation. These issues are best dealt with at the State and local levels.

Won’t this result in the CFPA and the States issuing rules on the same topic?

No. Historically, the States have stepped in where Federal policymakers have failed to establish adequate protections. The CFPA is intended to avert such failures in the future. If the CFPA does its job, it will ensure that consumers are adequately protected, and States will not feel compelled to go further. State legislators are subject to the same pressures as all other policy makers, and they do not seek out reasons to push back against the lending industry. Keeping alive the States’ traditional role will provide a backstop against lapses at the federal level and extra assurance that consumers will be appropriately protected. This will also incent industry to cooperate with efforts by the CFPA to issue protections that are appropriately robust and effective.

Are there other advantages to retaining the State’s traditional role in policymaking?

State laws responding to local problems provide useful models and data points for policymakers in other States and at the Federal level. This keeps our policies vibrant and innovative, and enables Federal policymakers to develop best practices based on the experiences of the States.

Click here to continue reading two news clips about the Consumer Financial Protection Agency.

Tom Swan on Passage of Credit Card Reform Legislation

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CCAG Executive Director Tom Swan has an op-ed in the Connecticut Post about the recently passed Credit Card Accountability, Responsibility and Disclosure Act, which was sponsored by Chris Dodd, Connecticut's senior Senator.


Tom Swan speaks about how the unfair practices of credit card
companies affect CCAG members and others in Connecticut.
[March 13, 2009]

Swan explains the importance of the bill:

The bill puts an end to absurdly high fees that drive families further into debt, requiring that penalties be proportional to the violation and prohibiting issuers from charging fees when customers simply pay by phone or unknowingly exceed their credit limit.

It prevents credit card companies from charging you if they delayed crediting your payment and requires far better disclosure of card terms and conditions.

It includes tough protections for the particularly vulnerable demographic that has been a cash cow for credit card companies in recent years: young people and students.

Click here to continue reading excerpts from Swan's op-ed.

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