NCL to teens: avoid these five worst summer jobs – National Consumers League

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May 29, 2009

One teen American worker dies from a workplace injury every ten days; advocacy group warns parents and teens to be smart this summer and protect themselves from workplace hazards

Contact: 202-835-3323, media@nclnet.org

WASHINGTON, DC – With summer just around the corner, and many teens competing with out-of-work adults for summer employment, the National Consumers League has issued its annual report for 2009 on the Five Worst Teen Jobs, with work in agriculture again topping this year’s list for the third year running. Based on statistics from the National Institute for Occupational Safety and Health (NIOSH), a teen American worker dies from a workplace injury every ten days, and an estimated 158,000 youth sustain work-related injuries and illnesses each year.

The National Consumers League (NCL), which coordinates the Child Labor Coalition, has issued this year’s Five Worst Teen Jobs report to remind teens and parents that while it’s never too late to focus on safety when considering a summer job, it’s often difficult to see the hidden dangers in many jobs that are legal for teens to perform.

“Seeing the dangers in summer work isn’t always easy. Jobs like construction are obviously dangerous, but others like retail work can pose hidden dangers when teens are asked to work alone at night and may be vulnerable to robberies and assaults,” said Reid Maki, NCL’s Director for Social Responsibility and Coordinator of the Child Labor Coalition. “And at times, young workers performing seemingly safe jobs are asked to do very unsafe things, such as using trash compactors, something the law specifically prohibits them from doing because it is too dangerous. Choosing a summer job can be very difficult, even for those parents and teens who are mindful of safety concerns.”

In 2007—the last year for which there are complete records—an estimated 2.6 million adolescents aged 16 to 17 years worked in the United States, and that figure does not include the 400,000 children of migrant and seasonal farmworkers who work at ages younger than 16 because of loopholes in our child labor laws.

“Each year, the National Consumers League issues our Five Worst Teen Jobs report to remind teens and their parents to choose summer jobs wisely,” said Sally Greenberg, NCL Executive Director and co-chair of the NCL-coordinated Child Labor Coalition. “Summer jobs can contribute a lot to a child’s development and maturity, and teach new skills and responsibilities, but the safety of each job must be a consideration. If you think employers, even good-intentioned ones, and federal child labor laws can protect our young workers from dangerous tasks, think again.”

NCL’s Five Worst Teen Jobs of 2009 (read full report)

  1. Agriculture: Harvesting Crops
  1. Construction and Height Work
  1. Driver/Operator: Forklifts, Tractors, and ATV’s
  1. Traveling Youth Sales Crews
  1. Outside Helper: Landscaping, Groundskeeping and Lawn Service

The Five Worst Jobs of 2009 report focuses on jobs that are legal for teens to perform despite placing young workers in potentially dangerous environments, according to NCL. Despite urging by advocates for Congress and the Department of Labor to prohibit the jobs known as the “most dangerous forms of child labor,” most of the activities on the list remain legally permitted work for teens, including work at heights, poultry catching and processing, driving tractors and all-terrain vehicles (ATVs), operating chain saws (prohibited for only use on wood) and working on traveling youth crews that sell magazines or other products.

In this year’s report, NCL has also highlighted illegal work in meat packing plants as a “Bonus Worst Job” in addition to the legal worst five jobs. Although workers must be 18 years old to legally work in these plants, recent federal immigration raids have found children as young as age 15 working in meat packing. Reports that 50 teens may have been working in the Agriprocessors plant in Postville, Iowa and the more than 9,000 child labor violations alleged against the plant by the State of Iowa have raised great alarm among child labor and child welfare advocates.

“Meat processing work, which involves repetitive use of very sharp knives, is extremely dangerous—for youth and adults. In a visit to Postville, Iowa last summer, we met a young worker who cut himself processing meat when he was only 16 years old,” said Maki. “The truth is that even laws that are meant to protect our young workers are not being obeyed, and teens are at great risk.”

NCL compiles the Five Worst Teen Jobs each year using government statistics and reports, including monitoring reports from state labor officials and news accounts of injuries and deaths. Statistics and examples of injuries for each job on the list are detailed in a report available here.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

White House Welcomes Consumer Groups for Historic Bill Signings – National Consumers League

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By Sally Greenberg, NCL Executive Director

On two occasions this week, consumer groups were invited to the White House to witness President Barack Obama’s historic signing of legislation intended to protect the interests of consumers and homeowners. I was lucky enough to attend both events. On Wednesday, the President signed the Helping Families Save Their Homes Act and The Fraud Enforcement and Recovery Act. These bills are intended to crack down on those who seek to take advantage of homeowners through fraud and other abuses. On Friday, the President signed the Credit Card Accountability, Responsibility, and Disclosure Act, a new law that will rein in some of the worst abuses of the credit card industry and help to restore the balance between consumers using their credit cards responsibly and the credit card industry’s obligation to treat their customers fairly, and not hiking up rates without notice, backdating interest on old balances, or changing terms, in the words on your credit card contract, “anytime for any reason.” I have lived and worked as a consumer advocate in Washington for more than a decade and had never been to a White House bill signing.

It wasn’t for lack of trying. Several years ago consumer and safety advocates worked hard to persuade the Bush Administration to celebrate the signing into law of the Cameron Gulbransen Kids and Cars Safety Act, which will protect toddlers especially from being backed over and killed when they run behind their parents’ car and cannot be seen because of blind areas behind the vehicle. The act sets a standard for rearward visibility in all cars. Unfortunately, we couldn’t manage to get a public signing at the White House for the many parents whose children had died or been injured, and who would have welcomed the opportunity to celebrate passage of this bill.

But the Obama Administration has reached out to consumer advocates in a new and important way that we hope will benefit the millions of consumers whose interests we try hard to protect each day. About a month ago, nine or so consumer organizations met with White House staff to discuss a range of issues, from product safety, to credit card legislation, homeowner protections, energy prices, access to the courts, and important appointments to agencies that provide consumer protection and enforce health and safety laws. We brought with us our platform of six issues that the groups had issued last December.

Attending an event at the White House is a heady experience. As my 91-year-old father pointed out recently, having the chance to be part of an event with a standing president is a significant honor. Yet there we were, mixing on Wednesday in the East Room with Senators, Representatives, cabinet secretaries, the President’s own staff, and discussing the important protections these bills would provide for homeowners and on Friday, in the Rose Garden, ten or so consumer representatives – who had fought for these provisions for a number of years, and brought with them individual consumers who had endured terrible experiences with credit cards – one woman’s son had committed suicide when faced with mounting debt on his credit cards. I watched the President listen to her story and give her a hug afterwards.

The President on Wednesday spoke eloquently about both the trials that homeowners face when confronted with the possibility of losing their homes – and the fraud thousands have faced at the hands of unscrupulous businesses, and on Friday talked with compassion about those consumers who never expected to confront mounting debt on the credit cards but had lost a job or faced a health care crisis. The bill will provide, in the President’s words, “common-sense reforms designed to protect consumers.”

Under the new law: credit card issuers will be required to tell card holders how long it will take to pay off a balance and what it will cost in interest if they only make the minimum monthly payments; retroactive rate hikes that appear on a bill “suddenly with no rhyme or reason” will be barred, Obama said; companies will have to post their agreements online; consumers will have to mail statements 21 days before payment is due, instead of 14; shifting payment dates will be prohibited; and 45 days’ notice will be required for changes in terms and conditions.

Some estimates say that the average household debt by credit cardholders who carry a balance is around $17,000. The White House said that every year, Americans pay around $15 billion in penalty fees. Nearly 80 percent of American families have a credit card, and 44 percent of families carry a balance on their credit cards. President Obama also pointed out that this bill is a good balance, and said the changes were not intended to encourage reckless spending. For the White House Fact Sheet on the bill, click here.

Consumer advocates hope that this week is a watershed, opening the way to a new era in which Congress and the White House are, after a long dry spell and a painful economic downturn, feeling the pain that the average American is experiencing and are trying at last to level the playing field so that the average consumer gets a fair shake. We at the National Consumers League welcome this new way of doing business.

Crack down on Mislabeled Cheerios Welcome Action by FDA – National Consumers League

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by Sally Greenberg, NCL Executive Director

Today’s news that the U.S. Food and Drug Administration appears to be cracking down on food manufacturers’ product claims that cross the line into “medical” is welcome to consumer advocates like the National Consumers League. Last fall, we sent a letter to the FDA Commissioner Andrew von Eschenbach, complaining that the makers of Cheerios seem to be going too far with their cholesterol-lowering claims about the product. Looking at a big yellow box of Cheerios at the time, we saw that the manufacturer, General Mills, was boldly enticing consumers to “Join the Challenge and Lower Your Cholesterol 4% in 6 weeks.”  The back panel repeated the claim, and directed consumers to “Sign Up Today at CheeriosChallenge.com”Our beef with all this was that General Mills’ claims of lowering eaters’ cholesterol levels promises consumers a health benefit, merely by consuming Cheerios® breakfast cereal without accompanying changes in diet or lifestyle, and this type of “magic bullet” health claims aren’t allowed by the laws that the FDA enforces. Cheerios isn’t medicine; it can’t make claims that taking it has a health-improving affect.

So now that FDA has issued a warning letter to General Mills about our shared labeling concerns, we are hopeful that: a. General Mills will clean up its act quickly and stop making misleading claims about its food products and b. this is a sign that those in charge of our very important federal regulatory agencies are interested in cracking down on similarly misleading claims, which are widespread in today’s marketplace.

For more than 100 years, NCL has been concerned about the misleading, deceptive labeling and marketing practices by food and other producers. NCL volunteers staffing a booth at the 1904 St. Louis World’s Fair demonstrated to fairgoers that canned green beans touted by food processors as a labor-saving home product were adulterated with green dye. Since then, NCL has continued to work tirelessly to ensure that foods, drugs, and other consumer products are safe, healthful, and effective; that their contents are presented clearly and completely; and that advertisements promoting them are fair and honest. We’ve voiced concern over misleading labeling in more recent years, such as those containing sloppily-used terms like “natural” and “fresh,” and we’ll continue to work to ensure the products marketed to consumers are fairly and accurately represented by their manufacturers.

Critics, such as the NBC Today Show’s Dr. Nancy Snyderman, are suggesting that the FDA has better things to do than go after a cereal company on claims like this. But these critics are getting it wrong. Misleading labeling has plagued consumers for many years and comes at great risk to consumers, not only related to their health but to their pocketbooks. Consumers who are misguidedly confident they are getting a daily dose of cholesterol medicine every morning in their cereal may not seek expert medical guidance from their health care practitioners. Cheerios is not an acceptable substitute for quality medical care.

Further, the high-profile nature of what the FDA conveyed in this letter to General Mills, whose Cheerios is the most popular breakfast cereal, gets the federal agency a lot of bang for its buck and sends a message to other food companies that they mustn’t exaggerate claims about a food having the ability to cure diseases when foods cannot do that.

NCL applauds FDA for warning General Mills for misbranding Cheerios – National Consumers League

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May 13, 2009

Contact: 202-835-3323, media@nclnet.org

Washington, DC–In response to a letter of complaint sent by the National Consumers League (NCL) the U.S. Food and Drug Administration (FDA) has issued a warning letter to General Mills for the misbranding of its Cheerios cereal as a cholesterol-lowering product. In September of 2008, NCL’s Executive Director Sally Greenberg wrote to the FDA to complain about the “drug-like claims” on boxes of Cheerios cereal:

“General Mills on the front panel of its Cheerios® breakfast cereal label boldly entices consumers to “Join the Challenge and Lower Your Cholesterol 4% in 6 weeks.” The back panel similarly claims, “You Could Lower Your Cholesterol 4% in 6 weeks,” and directs consumers to “Sign Up Today at CheeriosChallenge.com” General Mills’ claim promises consumers a health benefit (i.e., lowered blood cholesterol levels) merely by consuming Cheerios® breakfast cereal without accompanying changes in diet or lifestyle. NCL understands that such “magic bullet” health claims are impermissible under the laws that your agency enforces and properly are reserved to cholesterol-lowering medications . . .”

The League, founded in 1899 as America’s oldest consumer group, has frequently filed complaints with the FDA on misleading claims, specifically, on manufacturers’ use of the words “healthy” and “natural” on food products and dietary supplements. NCL has also called attention to a manufacturers’ misuse of “low fat” and “fresh.”

The FDA’s warning letter to General Mills contains two significant findings, first informing Chairman and CEO of General Mills, Ken Powell, that “Your Cheerios ® product is misbranded . . . because it bears unauthorized health claims in its labeling.” Secondly, the FDA’s letter finds that “. . . your Cheerios® Toasted Whole Grain Oat Cereal is promoted for conditions that cause it to be a drug because the product is intended for use in the prevention, mitigation, and treatment of disease.” As a result, FDA has informed Mr. Powell that Cheerios is therefore considered a drug and subject to drug regulation by the federal agency.

“We applaud the FDA for taking tough regulatory action in response to NCL’s letter last fall, highlighting the impermissible claims General Mills is making about Cheerios. Consumers deserve accurate information and truth in labeling in the products their families purchase and consume. General Mills should know better than to market its cereals with these false claims,” Greenberg said.

FDA’s letter instructs General Mills to correct its violations and to inform the regulatory agency what steps are being taken within 15 days of receiving the warning. For copies of the NCL letter and the FDA’s response, visit www.nclnet.org.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

The Need for a Mandatory Binding Arbitration Overhaul – National Consumers League

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by Sally Greenberg, NCL Executive Director

In the past several weeks, I’ve had two occasions to think about the effects of those ubiquitous binding mandatory arbitration clauses that are found in so many consumer contracts today. Two weeks ago, I spoke on a panel at an American Bar Association meeting on the Arbitration Fairness Act and advocating for an end to forcing consumers into mandatory arbitration. Then last week, I visited Congressional offices with homeowners whose houses had been built with such shoddy workmanship that they were unliveable – and yet they couldn’t seek remedies in court because of mandatory arbitration clauses in their contracts and the homebuilder himself owned or controlled the arbitration service. Adult children of nursing home residents described how their elderly parents were talked into signing arbitration clauses and subsequently developed deadly infections because of mistreatment and neglect, but the surviving children we barred from getting their cases heard in court because of a BMA clause, and the arbitrator sided against them. The companies offering arbitration actively seek the business of corporate clients, often promising them positive outcomes. In other words, the business of offering arbitration in consumer cases has become increasingly corrupted and biased.

What are these odious BMA clauses and how do they work? The clauses are buried in a contract you agree to as a condition of getting the service or good. The provisions contain some version of the following: “if there is a dispute between the parties the exclusive forum for determining remedies is arbitration carried out by the XX (one of three arbitration companies)” . That is, you can’t go to court, not even small claims court, you can’t bring a class, you can’t have a judge decide your case. They were described to me by corporate lawyer as a “risk management tool for corporate America.” That is pretty accurate, because these clauses prevent companies who engage in wrongdoing from being held accountable in a court of law. And they have worked beautifully to protect wrongdoers and emboldened them to add more and more of these clauses in their agreements with consumers.

If you think you aren’t affected by a BMA clause, think again. Anyone who’s signed up for a credit card, bought a computer, bought a cellphone, taken out a line of credit, rented a car, or engaged in any of the millions of transactions consumers deal with every day has agreed to one of these clauses, most often without knowing it.

That is why consumer groups and many others support the Arbitration Fairness Act—HR 1020 in the House sponsored by Congressman Hank Johnson (D-GA) (the Senate bill doesn’t have a number yet) — which will bar pre-dispute mandatory binding arbitration in consumer and employment contracts. There’s nothing wrong with arbitration or mediation as an alternative to court if both parties agree to take this route AFTER the dispute has arisen and voluntarily. But forcing consumers and workers—60 percent of employment contracts apparently contain such clauses, and workers must agree to them if they want the job—into a private system of “justice” —which charges them a fee to get their case heard, deprives them of a judge, the right to submit and have the rules of evidence enforced, have a decision based on the law, have a written record, the right to appeal, and have a public record of the adjudication – is wrong and must end.

Moreover, consumers are deprived of counsel because few lawyers will take on cases if there’s an arbitration clause involved; the deck is stacked against the client and the lawyers find it hard to get paid. Faced with insurmountable odds, consumers or workers often are unable to fight for their rights, even if they have a strong case, because the arbitration system is so skewed against them.

A powerful coalition of consumers, workers, civil rights leaders, families of nursing home patients, and many other groups are seeking passage of the Arbitration Fairness Act in order to restore justice to a system that’s been hijacked by corporate interests. We know we’ll have a major challenge going up against the corporate entities that defend these clauses by making the dubious claim that they are “good for consumers” because, they argue, they provide “quicker, cheaper and more equitable resolution of cases.” If these BMA clauses are good for consumers, don’t force consumers into it, let them decide for themselves to opt for an alternative to court. If the system is fair, including the right to enter into class actions, the parties will choose arbitration.

Right now, powerful interests have commandeered the legal system, making it work as a shield that keeps them from being held accountable in the event that a homebuilder has engaged in wholesale consumer fraud in construction, or an employer has fired someone because they are African American, or a nursing home has neglected or abused an elderly resident so terribly that she dies of severe infection. The Arbitration Fairness Act will correct these abuses; NCL and other consumer groups intend to work tirelessly to unmask the corruption in the BMA system and see it addressed once and for all through the enactment of Arbitration Fairness Act.

Open Door at White House for Consumer Groups – National Consumers League

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By Sally Greenberg, NCL Executive Director

Last Friday, May 1, a number of national of consumer groups were invited to meet with White House staff to discuss our priorities for the coming legislative season. If you think about it, much of what has occupied the new Obama Administration is directly related to consumer concerns: the housing foreclosure crisis, rising credit card debt, and a host of unfair lending practices by many banks issuing the cards. With the recall of peanuts and peanut butter a few months ago, food safety has become another top priority. And the Act passed last year, reforming product safety law and regulation after children’s toys were found to have excessive levels of lead needs implementation.

Our groups have a lot of expertise and a variety of concerns. Last December our groups issued a platform laying out many of these in a six point Consumer Platform covering food and product safety, health care reform, financial services, access to the courts, energy, and restoring the office of consumer affairs in the White House to give consumers a voice at the highest levels. We were pleased to have the chance to discuss these with senior White House staff.

I used my five minutes describing the National Consumers League’s Medication  Adherence Campaign, highlighted our LifeSmarts financial literacy and consumer education competitions for teens, and talked about NCL’s Fraud Center, our work on child labor issues and close working relationship with unions, tying together the issues of workers and consumers.

The groups together expressed appreciation to President Obama for using his bully pulpit to bring banks to the White House and asking them for “fair and transparent” rules and to reform some of the most odious practices – like using low, teaser interest rates to draw consumers in and then doubling those rates within weeks of issuing the card, allowing consumers to exceed their credit limits, then imposing excessive rates, or charging consumers who pay their bills by phone or Internet. Last week the House of Representatives delivered a powerful message to the industry – by a vote of 357 to 70, with 107 Republicans voting in favor, the House passed the Credit Cardholders Bill of Rights, which addresses some of the worst practices. The Senate is set to act this week.

White House staff promised that we will soon see a nominee to head the Consumer Product Safety Commission, which regulates product safety, including the safety of toys and other baby products and badly needs new leadership. Among the other issues we addressed were the need for broad based assistance to homeowners facing disclosure, payday loans and restoration of usury limits on loans, auto safety, consumer fraud, securities regulation, and protections for low income, military and immigrant communities that are often targets of fraud.

Together, our groups represent the interest of millions of consumers across America. It was satisfying to find an open door in this White House and to have the chance to outline our concerns about the host of issues facing consumers in the United States today.

NCL applauds Obama nominations for CPSC – National Consumers League

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May 6, 2009

Contact: 202-835-3323, media@nclnet.org

Washington, DC—The National Consumers League applauds President Barack Obama’s nominations of Inez Tenenbaum, attorney and former Superintendent of Schools for the state South Carolina, as Chairman of the Consumer Product Safety Commission (CPSC) and Professor Robert Adler, who worked as counsel to former CPSC Commissioner R. David Pittle, as Commissioner. Adler also served as a member of the Consumers Union board of directors.

The following statement may be attributed to Sally Greenberg, National Consumers League Executive Director:

Inez Tenenbaum has shown, through her work as South Carolina’s Superintendent of Schools, that children’s health and safety are a high priority. As superintendent, she worked to fight obesity and to promote nutritional programs in the schools; as Superintendent, she has also had the kind of management experience that will be needed to run the CPSC.

If she is confirmed, Tenenbaum’s previous experience will serve her well in her new role as head of the Consumer Product Safety Commission, a federal agency that regulates the safety of over 15,000 products, including many products for children. We will welcome Tenenbaum to Washington and look forward to working with her in her new role as CPSC Chairman.

About Robert Adler, Greenberg also noted:

I’ve known and worked with Bob Adler on product safety issues for more than a decade. He is a highly qualified nominee who has a depth of knowledge about the CPSC and its authorizing statute, and he will be a strong champion for consumer health and safety. Both of these nominees will help to restore the CPSC to the agency Congress originally intended it to be: an independent federal safety agency that effectively protects consumers, and especially children, from product safety hazards.

The National Consumers League also commends the President for pressing for full funding of the Commission and his stated intent to restore the agency to its full complement of five commissioners.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

Preparing for a Pandemic – Swine Flu 101 – National Consumers League

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By Mimi Johnson

A little more than a week after the first announcements of the H1N1 flu (swine flu) hitting the United States, it seems the virus has now spread throughout much of the country. Though it now appears to be a milder flu than was initially expected, we still need to act with good judgment (and hygiene) to help keep this virus at bay!

Some things to consider:

  • If you or a member of your household is diagnosed with the H1N1 flu virus, notify employers and schools as soon as possible.
  • If you or a member of your household is feeling sick or exhibiting flu-like symptoms, do not go to school or work. You should also limit the contact you (and your sick household) has with others.

Some measures YOU can take to prevent yourself from getting the flu:

  • Cover your nose and mouth with a tissue (or your elbow) when you cough or sneeze, and throw the tissue away immediately after using it.
  • Wash your hands often with soap and water — especially after you cough or sneeze, touch communal handrails, door knobs, etc., or before you eat; alcohol-based hand cleaners or wipes will also do the trick.
  • Avoid touching your eyes, nose, or mouth. That’s how germs spread.

The flu is thought to spread mainly person-to-person, so preventing the spread of germs is your #1 defense!

Some things you shouldn’t do:

Time Magazine has put together this helpful list of Top 5 Swine Flu don’ts.

You should continue to stay informed – check your local news and health departments to learn about the flu in your region.  Also, check the CDC’s H1N1 Web site for the most current and detailed official information.

On the off-chance that the flu situation causes closures of schools, work, and points of service like grocery stores, restaurants, etc., the Centers for Disease Control (CDC) recommends you develop a family emergency plan as a precaution. “This should include storing a supply of food, medicines, facemasks, alcohol-based hand rubs and other essential supplies.”

Credit Card Reform: It’s about Time – National Consumers League

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by Sally Greenberg, NCL Executive Director

Three cheers for President Obama’s speaking out publicly against some of the worst abuses in the credit card industry. Mr. Obama called to the White House the heads of banks issuing these cards and gave them a dressing down. No more “anytime, any reason rate hikes,” he said. Credit cards companies should offer a “plain vanilla, easy to understand, simplest terms possible” card for the average user, and not bury hidden charges and fees in the fine print of the contract.

Consumer groups have long urged Congress to reform the most odious practices of  the credit card industry, including calling for a ban on mandatory arbitration clauses in all their contracts and barring class actions for users who have complaints against their credit card issue. We’ve called for bans on universal default – a practice that sends your credit card interest rates up if you default on another unrelated payment, say your mortgage. In a recent Washington Post article, a reader who had perfect credit but miscalculated her payment date and was two days late on a bill saw her interest rate shoot up. She was told this hike was “automatic.”

We applaud the President for using his bully pulpit to call out the rampant abuses in this industry.  Earlier this year, the Federal Reserve issued regulations to curb many of these abuses, but those rules won’t go into effect into effect next year. NCL has joined with a host of other consumer groups in a letter to Congress supporting House and Senate bills to codify into law many of the Fed’s rules. Among the bills’ features are banning interest rate increases on existing balances unless payment is more than 30 days late and forbidding “double-cycle billing,” the practice of charging interest on debts paid off the previous month. The bills would require 45 days’ notice for a rate increase on your credit card account.

We hope the President will weigh in with Congress in support of these all-important issues. His voice will be needed to overcome the vocal opposition from the industry and their supporters in Congress.by Sally Greenberg, NCL Executive Director

Three cheers for President Obama’s speaking out publicly against some of the worst abuses in the credit card industry. Mr. Obama called to the White House the heads of banks issuing these cards and gave them a dressing down. No more “anytime, any reason rate hikes,” he said. Credit cards companies should offer a “plain vanilla, easy to understand, simplest terms possible” card for the average user, and not bury hidden charges and fees in the fine print of the contract.

Consumer groups have long urged Congress to reform the most odious practices of  the credit card industry, including calling for a ban on mandatory arbitration clauses in all their contracts and barring class actions for users who have complaints against their credit card issue. We’ve called for bans on universal default – a practice that sends your credit card interest rates up if you default on another unrelated payment, say your mortgage. In a recent Washington Post article, a reader who had perfect credit but miscalculated her payment date and was two days late on a bill saw her interest rate shoot up. She was told this hike was “automatic.”

We applaud the President for using his bully pulpit to call out the rampant abuses in this industry.  Earlier this year, the Federal Reserve issued regulations to curb many of these abuses, but those rules won’t go into effect into effect next year. NCL has joined with a host of other consumer groups in a letter to Congress supporting House and Senate bills to codify into law many of the Fed’s rules. Among the bills’ features are banning interest rate increases on existing balances unless payment is more than 30 days late and forbidding “double-cycle billing,” the practice of charging interest on debts paid off the previous month. The bills would require 45 days’ notice for a rate increase on your credit card account.

We hope the President will weigh in with Congress in support of these all-important issues. His voice will be needed to overcome the vocal opposition from the industry and their supporters in Congress.