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Consumers Union asks Fed to take action on credit card debt practicesThe Consumers Union is encouraging the Fed to take measures to stop companies that provide credit cards from raising interest rates on accounts. Many credit card companies are raising rates in anticipation of new rules provided by the Credit Card Accountability, Responsibility and Disclosure Act, some of which take effect in February 2010. Those rules would keep credit card companies from arbitrarily raising card rates on consumers. They would also require lenders to review increases in interest rates on credit card debt. "There's no question that many credit card companies are using the long implementation time before new regulations go into effect to gouge consumers and test new ways to evade the law," Lauren Bowne, staff attorney with Consumers Union, said. The Consumers Union wants the Fed to do a number of things, including stopping card companies from implementing interest rate changes that would be illegal under the new rules in the Credit CARD Act. Those would include making consumers choose between having a high minimum payment and having a high interest rate. Many members of Congress also have taken notice of the credit card companies' actions. As a result, some are trying to pass a bill that would speed up the effective date for the second set of rules put forward by the Credit CARD Act. Rather than take effect in February, the new rules would come to be once the proposed bill is signed into law by President Barack Obama.
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