U.S. Senate candidate Jennifer Brunner continues to roll out populist,
pro-consumer policy statements, calling today for a cap on the interest
rates that credit card companies can legally charge customers.
Brunner
praised the recent passage of federal legislation, known as the “Credit
Cardholder Bill of Rights,” pushed by President Barack Obama. It will
limit sudden hikes in credit card interest rates, but Brunner said more
work is needed.
“Until this bill becomes law next summer,
Americans trying to pay down their credit card balances will be at risk
for being slapped with sudden interest rate increases, excessive fees,
double-cycle billing or charging interest on paid balances and credit
card companies applying payments to low-interest balances before the
higher-interest ones,’’ she said. “To prevent credit card companies
and financial institutions from padding the nest now, we need to
quickly impose a cap on interest rates so that the bill has some teeth
and actually protects everyday Americans when it finally becomes law."
She
also used today’s release to take a poke at John Thain, hired by
Merrill Lynch in 2007 to guide the brokerage firm through the financial
crisis, and for executives of Countrywide Financial, a major player in
the home foreclosure crisis. Thain charged the company $1.2 million to
renovate his new office and surrounding work area, including a pair of
guest chairs costing $87,783. Countrywide spent $940,000 in country
club memberships for top executives from 2003 through 2006.
“As
middle-class Americans have been trying to pay down their credit
balances and spend responsibly, financial institutions are pushing off
on consumers the effects of poor decisions and the excesses of
executives whose extravagances are not enjoyed by everyday Americans.
Now, instead of doing what ordinary consumers are forced to do—tighten
their belts and make it on what they have—it is expected that some of
these institutions will be leveraging their superior financial position
to gouge the very lifeblood of their businesses until the law takes
effect and they are forced to treat their customers with respect. All
of us, citizens and corporate citizens alike, should share in the
sacrifices needed for economic recovery,” Brunner said.
An amendment to cap interest rates between 15 and 18 percent received just limited support when the legislation was considered
Jamie
Court, president of Consumer Watchdog, has singled out the rate cap as
the main unfinished business in the otherwise widely praised credit
reform package:
“With banks that issue credit cards receiving
virtually free money from the Fed, on top of the hundreds of billions
in bailout funds from taxpayers, there's a great case to be made for a
national cap on credit card interest. As Congressman Brad Sherman said
on Air Talk today, the lack of a cap shows the banks still have a lot
of power on the Hill.”
Brunner said she plans to seek passage
of the rate cap if elected to the U.S. Senate. She hopes to replace
Senator George Voinovich, who does not plan to run for reelection. If
elected Brunner would become the first woman to hold a U.S. Senate seat
from Ohio. She is currently Ohio’s Secretary of State where she has
emerged as a strong advocate for working families and election reform.
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