WASHINGTON -
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. ... We have some real momentum for reform."
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Five big financial companies - Discover Financial Services LLC, Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Capital One Financial Corp. - issue around 80 percent of U.S. credit cards, according to the subcommittee. Officials of Discover, Bank of America and Capital One were testifying at Tuesday's hearing.
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