Credit Card Accountability, Responsibility and Disclosure Act of 2009
Congress loves acronyms. So every time Wall Street rips off Americans and Congress reacts to the scam, the government comes up with the clever name of a law that likely won’t solve any problems in the future.
Meet the Credit Card Accountability Responsibility, and Disclosure Act of 2009, or CARD.
This was a law passed under the Obama Administration that aimed to provide “fair and transparent” practices around consumer credit plans. That’s a fancy way of saying that credit companies should provide greater awareness of unexpected fees, and disclose payment penalties.
Keep in mind that consumer credit protection laws had been passed by Congress all the way back in 1968. So this law was just a reaction to the loopholes that the credit organizations had discovered, and ultimately exploited.
This bill requires that lenders have to provide advanced warning of rising interest rates. They also need to tell lendees how long it will take to pay off a loan if they just make minimum payments over time. Credit card companies were also no longer allowed to give away merchandise on college campuses, or to market to young Americans. It also limited expiration dates on gift cards.
Oh, there’s also (for some reason) a rider in the bill that prevents the Secretary of the Interior from prohibiting firearms in national parks. So...there’s that.
Related or Semi-related Video
Finance: What is the Credit Rating Agenc...4 Views
Finance allah shmoop what is the credit rating agency reform
act of two thousand six otherwise known as crack are
out out something like that All right yeah that's How
the real pros said anyway this act was meant to
improve the quality of company credit ratings like a blindfold
and dartboard should not be involved in making up are
you know coming up with corporate credit ratings Well the
law was ironically enacted in the hope that we would
avoid nightmares like the subprime mortgage crisis that almost brought
down the finances of while the entire country in world
And yes it worked in the same way that a
scale works in an embarrassing episode of the biggest loser
The idea was that the big three agencies moody's s
and p and fitch were colluding with each other and
raiding every security as a okay sort of the same
way wall street cell site analysts were leaned upon in
the nineties by bankers who paid them to rate every
company of strong by so that the companies would favor
the investment banks when doing lucrative secondary offerings and other
personal wealth management services for the founders and senior executives
Newly ridge from you know aipo booty The big three
then produced a product that wasn't reflective of the real
risks inherent in the marketplace Basically they had been labeling
pink slime and hot dog meat as great a sirloin
Yeah well the act made it much easier for smaller
firms to compete for business by doing high quality research
and not being afraid to give bad ratings tow bad
money butchers will The credit rating agency reform act of
o sixth gives both businesses and the government the tools
they need to fight off the shady hucksters of the
world And make sure the pink slime never you know 00:01:55.443 --> [endTime] such a cz your plate financially
Up Next
What is a line of credit? A line of credit is kind of like a loan. A bank gives a borrower a line of credit, which basically says they can borrow ...
What are Credit Scores and Worthiness? One of the most ubiquitous ways that digital society now dictates our lives is with business and personal cr...
What is the Equal Credit Opportunity Act? Signed into law during the Nixon-Ford era in 1974, the Equal Credit Opportunity Act is essentially an ant...