II 

110TH CONGRESS 

2D SESSION S. 3287 

To amend the Truth in Lending Act to establish a national usury rate 

for consumer credit transactions. 

IN THE SENATE OF THE UNITED STATES 

JULY 17, 2008 

Mr. DURBIN introduced the following bill; which was read twice and referred 

to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To amend the Truth in Lending Act to establish a national 

usury rate for consumer credit transactions. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Protecting Consumers 

5 from Unreasonable Credit Rates Act of 2008’’. 

6 SEC. 2. NATIONAL MAXIMUM INTEREST RATE. 

7 Chapter 2 of the Truth in Lending Act (15 U.S.C. 

8 1631 et seq.) is amended by adding at the end the fol9 lowing: 


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1 ‘‘SEC. 140. MAXIMUM RATES OF INTEREST. 

2 ‘‘(a) IN GENERAL.—Notwithstanding any other pro3 vision of law, no creditor may make an extension of credit 

4 to a consumer with respect to which the annual percentage 

5 credit rate, as defined in subsection (b), exceeds 36 per6 cent. 

7 ‘‘(b) ANNUAL PERCENTAGE CREDIT RATE DE8 FINED.—For purposes of this section, the annual percent9 age credit rate includes all charges payable directly or in10 directly incident to, ancillary to, or as a condition of the 

11 extension of credit, including— 

12 ‘‘(1) any payment compensating a creditor or 

13 prospective creditor for an extension of credit or 

14 making available a line of credit, or any default or 

15 breach by a borrower of a condition upon which 

16 credit was extended, including fees connected with 

17 credit extension or availability, such as numerical 

18 periodic rates, late fees, excessive creditor-imposed 

19 not sufficient funds fees charged when a borrower 

20 tenders payment on a debt with a check drawn on 

21 insufficient funds, over limit fees, annual fees, cash 

22 advance fees, and membership fees; 

23 ‘‘(2) all fees which constitute a finance charge, 

24 as defined by rules of the Board in accordance with 

25 this title; 


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1 ‘‘(3) credit insurance premiums, whether op2 tional or required; and 

3 ‘‘(4) all charges and costs for ancillary products 

4 sold in connection with or incidental to the credit 

5 transaction. 

6 ‘‘(c) RELATION TO STATE LAW.—Nothing in this sec7 tion may be construed to preempt any provision of State 

8 law that provides greater protection to consumers than is 

9 provided in this section. 

10 ‘‘(d) CIVIL LIABILITY AND ENFORCEMENT.—In addi11 tion to remedies available to the consumer under section 

12 130(a), any payment compensating a creditor or prospec13 tive creditor, to the extent that such payment is a trans14 action made in violation of this section, shall be null and 

15 void, and not enforceable by any party in any court or 

16 alternative dispute resolution forum, and the creditor or 

17 any subsequent holder shall promptly return to the con18 sumer any principal, interest, charges, and fees, and any 

19 security interest associated with such transaction. Not20 withstanding any statute of limitations or repose, a viola21 tion of this section may be raised as a matter of defense 

22 by recoupment or set off to an action to collect such debt 

23 or repossess related security at any time. 

24 ‘‘(e) VIOLATIONS.—Any person that violates this sec25 tion, or seeks to enforce an agreement made in violation 


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1 of this section, shall be subject to, for each such violation, 

2 1 year in prison and a fine in an amount equal to the 

3 greater of— 

4 ‘‘(1) 3 times the amount of the total accrued 

5 debt associated with the subject transaction; or 

6 ‘‘(2) $50,000. 

7 ‘‘(f) STATE ATTORNEYS GENERAL.—An action to en8 force this section may be brought by the appropriate State 

9 attorney general in any United States district court or any 

10 other court of competent jurisdiction within 3 years from 

11 the date of the violation, and may obtain injunctive re12 lief.’’. 

Æ 


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