The Obama administration has put in place the final provisions for a new financial regulation law, called the CARD Act, which will bring unprecedented controls to bear upon the heretofore lightly regulated credit card industry in the United States.
Speaking after the Credit Card Accountability, Responsibility and Disclosure (CARD) Act was finalised, United States President Barack Obama said, “Yesterday, the final reform provisions of the CARD Act took effect. As of today, consumers will be protected against unreasonable fees and penalties for late payments, as well as unfair practices involving gift cards.”
Arguing that this law would put a stop to deceptive credit card practices and hold credit card companies accountable to their customers, Mr. Obama noted that it would also make the terms of credit cards more understandable and put a stop to practices designed to trap consumers. Further, the CARD Act would restrict rate increases that apply retroactively to old balances and would prevent companies from increasing rates within the first year an account is opened.
Touching upon the broader context of the Wall Street Reform and Consumer Protection Act that the President signed into law in July, he said a new Consumer Financial Protection Bureau would be empowered to look out for consumers in the U.S. financial system.
“In the wake of a terrible recession, these reforms and this independent consumer watchdog will not only protect consumers, they’ll strengthen our economy as a whole, levelling the playing field for responsible lenders and ensuring that families and small business owners are better able to make financial decisions that work for them,” he said.