"Working people are being squeezed" Credit Card Practices in the spotlight -just in time for the holidays...

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Credit Card Practices Denounced

WASHINGTON (AP) - Congress is renewing its scrutiny of the credit card industry, as some lawmakers denounce the practice of raising customers' interest rates when their credit scores decline, even if they make their card payments on time.

Industry critics say it's another example of abusive, confusing credit card practices that can push consumers deeper into debt.

Sen. Carl Levin, D-Mich., chairman of a Senate Homeland Security and Governmental Affairs subcommittee, is holding out the club of possible legislation to spur voluntary changes by the industry.

"Working people are being squeezed," Levin told reporters Monday. In a call for "good, strong legislation" to be enacted next year, Levin said that "these abuses need to be remedied. more

Congress to ask US banks to explain credit card 'abuses'

WASHINGTON (AFP) -- A US congressional panel Tuesday will ask some of America's largest financial institutions to explain how they set interest rates on credit cards after hundreds of consumers complained to Congress.

The Senate subcommittee on investigations has scheduled a hearing at which consumers are expected to relate how they were subjected to sharp rate hikes on their credit card bills despite paying the bills on time.

The panel, headed by Democratic Senator Carl Levin, held an initial hearing on credit card practices in March, but the lawmaker told reporters Monday that "abuses" were still occurring.

"People who have paid their bills on time, have paid the amount that they are required to pay, nonetheless may face these unilaterally gouging interest rate increases," Levin said. more

Congress Vs. Credit Cards

Ho ho ho. Just in time for the holiday spending season, members of Congress are skewering credit card companies for pushing allegedly abusive business practices on unwitting customers.

Tuesday, a panel led by Sen. Carl Levin, D-Mich., and Sen. Norm Coleman, R-Minn., will haul in executives from Discover, Bank of America (nyse: BAC - news - people ) and Capital One Financial (nyse: COF - news - people ). The lawmakers want to know why they raise customers' interest rates when those customers have a solid payment history.

The spotlight on the industry comes as Congress and the Bush administration consider regulatory fixes for the easy lending of the subprime mortgage industry. Levin says lawmakers have a "regulatory responsibility" to "end some abuses where they exist in the free market." more

Senators probe surprise credit card rate rises

WASHINGTON (Reuters) - As consumers whip out their credit cards for another holiday shopping binge, a U.S. Senate panel on Tuesday will examine surprise interest rate increases, even for cardholders who scrupulously make payments on time. more

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