04 Mar Credit Card Company Changes Practices Based on Congressional Pronouncements
You may recall the senate banking committee hearings held on the practices of the credit card industry in which the members of the committee decried with an almost unanimous voice the most notorious of these practices, including “universal default” and capricious increases in interest rates. The committee threatened to impose more regulation on the industry if these abuses were not promptly curbed.
Well, it seems that at least one stalwart of the credit card industry listened. On Friday, Citigroup announced that it would be ending “universal default” and “any time for any reason” interest rate increases. The change will be effective immediately for new customers of Citigroup and will be effective by April for all existing customers.
Thank you to Professor Elizabeth Warren of Harvard University for bringing this to our attention.
*Note: In 2012 Professor Warren was elected to Senator Warren ofMassachusetts, where she is continuing work on financial issues.
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