November 26, 2008
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News: Senator Menendez Decries CC Storm.
With all the foment going on in Washington over the deluge of crises and the way they play off each other, Senator Robert Menendez of New Jersey is speaking up over the destructive ways it is having on the consumer. He speaks against the ripple effects that have come to consume the credit card community and the unfair practices being placed upon the consumer as a result. He has long been an advocate for the consumer and has now grabbed the baton in his quest to protect consumers in the credit card market. In an effort to prevent the ‘paper crisis' from pulling the ‘plastic crisis' into the maelstrom, he is advocating stronger protections for credit card holders.
Mr. Menendez acknowledges the mounting storm of our nation's massive $1 trillion credit card debt-load and the other crises causing a flood of delinquencies and defaults in this industry. Yet still, he chides the industry for, what he calls "questionable practices." Some of these misgivings are inappropriate penalties and impulsive rate hikes for credit card consumers who have faithfully remained in good standing. The senator believes that these unfair measures were part of the contribution that caused the current problems in the first place. The last thing we want to do is to allow these practices to exacerbate the already-faltering situation any longer.
So, he has recently introduced a bill called the "Credit Card Reform Act". The purpose of this legislation is to provide even greater protection to consumers. Protection against the current "deceptive lending practices", especially one known as "universal default." Mr. Menendez is aiming to stop the practice of slamming card holders who are in good standing, but, inadvertently, miss a payment on one of their cards and then being nailed on every other credit card they hold, with severe penalties. He purports that penalties imposed should be commensurate with the actual costs incurred by each individual company.