Sanders introduces Credit Card Protection Act

Rep. Bernie Sanders, I-Vt., on Tuesday announced legislation aimed at ending what he called "some of the most egregious anti-consumer practices of the nation's credit card companies." "Too many Americans have been taken advantage of by the deceptive advertising of the credit card companies," Sanders said in a news release. "Charging economically vulnerable Americans outrageous interest rates and fees is simply not acceptable."

The Consumer Credit Card Protection Act of 2005 would stop some of the most egregious practices by:

Prohibiting "bait and switch" scams that raise consumers' interest rates for events wholly unrelated to the consumer's credit card account. For example, by law, credit card issuers can raise a person's interest rate for a late payment on a telephone bill that occurred before that person applied for, received and potentially transferred a balance to, a so-called "fixed rate" credit card. This bill would prohibit that practice.

Requiring credit card companies to provide real notice to consumers before raising interest rates or charging fees (not hiding rate increases or fees provisions in the small font of a "terms agreement") and waiting for consumers to notice that their rates have jumped or that they have been charged an astronomical fee.

Prohibiting credit card issuers from raising interest rates on preexisting balances for "fixed rate" cards. New terms should apply only to new purchases