By now everybody should know everything about the Credit Card Accountability Responsibility and Disclosure Act of 2009, affectionately known to us as The CARD Act. That knowledge should include each of the 89 offered amendments to the bill. However, if you missed one or two of the amendments, there is a list here.
In the interest of not losing every one of my readers, I will spare you the details of all of the amendments. But there are some important (and funny) issues raised in a select number of these amendments and I wanted to share them with you so we can avoid some of the penalties for non-compliance.
As it is the first amendment offered, looking at Amendment 1 seemed as good a place to start as any. It is also quite relevant in how payments are made and fees charged. In addition, for those of us in the TransPromo world, this pertains to how offers, applications and contracts are printed and precisely what is contained on them. Therefore, we really are looking at detailed issues related to document compliance.
Pay to Pay
This amendment, offered by Democrat Luis Gutierrez representing the 4th Congressional District of Illinois was accepted on April 30, 2009. In essence, one of the things this amendment does is allow credit card companies to charge you for paying your bill. Well, that characterization might be a tad unfair, (nah , it’s fair). Do you agree? Read on, decide, and please let us know what you think.
This amendment allows credit card issuers to charge you and me, regular consumers, for making expedited payments by telephone. Of course, card issuers cannot simply charge people whenever they want. Under the amendment, the consumer must request such an expedited payment (apparently, they do not have to request the associated fee).
So in order to pay your bill on time and avoid a late fee, you will be charged an expedited processing fee. No, I am not joking. Now practices will vary among card issuers, so do your homework here. What companies charge for late fees and expedited payments will vary greatly so read all of your mail from your card companies. The devil is in the details.
Document Mandates – How Big is Your Font?
This amendment also requires that all credit card offers (and solicitations and contracts, etc…) notify prospective applicants that excessive credit applications can adversely affect their credit rating. QUESTION: if a person is making an excessive number of credit card applications, do you think they are really concerned about their credit rating?
Like much of the rest of the bill, the implementation of this is left to the Board of Governors of the Federal Reserve. This my friends, is where the wheels come off the cart. The “suggested” guidelines have creditors supplying cardholders with information regarding the availability of legitimate and accredited credit counseling services. Therefore, we have lenders collecting fees when they receive payments from people they know have bad credit because they have applied for a bazillion credit cards, but at least they are being offered the name of a credit counselor, in writing. Perhaps it is even on a transactional document. Lenders can use the effectiveness of this medium to prove they communicated with their customers in writing.
Font sizes
However, not just any writing will do. Congress, loath to read bills themselves, requires all written information on any application, solicitation or agreement for any credit card account appear in no less than 12 point font. Yup, the leaders of the United States of America, a country in economic turmoil dealing with massive deficits, fighting wars all around the globe, are spending their time mandating *&^#% font sizes. And, just in case you are applying for your card in a store, the font police got your back there, too. Businesses who are self-issue credit must display a “large, visible sign” at counters with the same information that is required to be disclosed on the application itself.
The problem: they don’t say what size font must be used on the signs. Some lawyer’s kid will get their braces paid for with tax dollars when this oversight is litigated (and it will be litigated). Folks, I can’t make this stuff up. It’s nuts, but it’s the law.
Stay tuned for more, or subscribe to the feed so you don’t miss one important (or silly) compliance issue. While we try to look at this stuff with a bit of humor, it is important to your business. And if you are concerned that the intricacies of these laws could impact your company, it would be wise to get some professional input.
After all, if you have a small font (hey, I thought size didn’t matter!) it might be more than just the guys at the gym harassing you!
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