II 

110TH CONGRESS 

2D SESSION S. 3629 

To create a new Consumer Credit Safety Commission, to provide individual 

consumers of credit with better information and stronger protections, 

and to provide sellers of consumer credit with more regulatory certainty. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 26 (legislative day, SEPTEMBER 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 create a new Consumer Credit Safety Commission, to 

provide individual consumers of credit with better information and stronger protections, and to provide sellers 

of consumer credit with more regulatory certainty. 

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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Consumer Credit Safety Commission Act of 2008’’. 

6 (b) TABLE OF CONTENTS.—The table of contents of 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Findings. 

Sec. 3. Definitions. 


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Sec. 4. Establishment of Commission. 

Sec. 5. Authorization of appropriations. 

Sec. 6. Objectives and responsibilities. 

Sec. 7. Coordination of enforcement. 

Sec. 8. Authorities. 

Sec. 9. Collaboration with Federal and State entities. 

Sec. 10. Procedures and rulemaking. 

Sec. 11. Prohibited acts. 

Sec. 12. Penalties for violations. 

Sec. 13. Reports. 

Sec. 14. Effective date. 

1 SEC. 2. FINDINGS. 

2 The Congress finds that— 

3 (1) the Nation’s multi-agency financial services 

4 regulatory structure has created a dispersion of reg5 ulatory responsibility, which in turn has led to an in6 adequate focus on protecting consumers from inap7 propriate consumer credit practices; 

8 (2) the absence of appropriate oversight has al9 lowed excessively costly or predatory consumer credit 

10 products to flourish; and 

11 (3) the creation of a regulator whose sole focus 

12 is the safety of consumer credit products would help 

13 address this lack of consumer protection. 

14 SEC. 3. DEFINITIONS. 

15 For purposes of this Act— 

16 (1) the term ‘‘consumer credit’’ includes— 

17 (A) any payment compensating a creditor 

18 or prospective creditor, or an agent or affiliate 

19 thereof, for an extension of credit or making 

20 available a line of credit; 


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1 (B) any fees connected with credit exten2 sion or availability, such as numerical periodic 

3 rates, late fees, creditor-imposed not sufficient 

4 funds fees charged when a borrower tenders 

5 payment on a debt with a check drawn on in6 sufficient funds, over limit fees, annual fees, 

7 cash advance fees, or membership fees; 

8 (C) any fees which constitute a finance 

9 charge; 

10 (D) credit insurance premiums; 

11 (E) all charges and costs for ancillary 

12 products sold in connection with or incidental to 

13 the credit transaction; and 

14 (F) any direct or indirect fee, cost, or 

15 charge incurred in, in connection with, or ancil16 lary to a consumer payment system, including 

17 but not exclusive to merchant discount fees, 

18 interchange fees, debit card fees, check-writing 

19 fees, automated clearinghouse fees, payment-by20 phone fees, internet payment intermediary fees, 

21 and remote deposit capture fees; 

22 (2) the term ‘‘relevant congressional commit23 tees’’ means the Committee on Banking, Housing, 

24 and Urban Affairs and the Subcommittee on Finan25 cial Services and General Government of the ComVerDate Aug 31 2005 03:11 Oct 03, 2008 Jkt 079200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3629.IS S3629

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1 mittee on Appropriations of the Senate, and the 

2 Committee on Financial Services and the Sub3 committee on Financial Services and General Gov4 ernment of the Committee on Appropriations of the 

5 House of Representatives, and any successor com6 mittees as may be constituted; 

7 (3) the term ‘‘creditor’’ has the same meaning 

8 as in section 103 of the Truth in Lending Act (15 

9 U.S.C. 1602); 

10 (4) the term ‘‘finance charge’’ has the same 

11 meaning as in section 106 of the Truth in Lending 

12 Act (15 U.S.C. 1605); and 

13 (5) the term ‘‘consumer’’ means any natural 

14 person and any small business concern, as defined in 

15 section 3 of the Small Business Act (15 U.S.C. 

16 632). 

17 SEC. 4. ESTABLISHMENT OF COMMISSION. 

18 (a) ESTABLISHMENT; CHAIRPERSON.— 

19 (1) IN GENERAL.—An independent regulatory 

20 commission is hereby established, to be known as the 

21 ‘‘Consumer Credit Safety Commission’’ (in this Act 

22 referred to as the ‘‘Commission’’), consisting of 5 

23 Commissioners appointed by the President, by and 

24 with the advice and consent of the Senate. 


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1 (2) MEMBERSHIP.—In making appointments to 

2 the Commission, the President shall consider individ3 uals who, by reason of their background and exper4 tise in areas related to consumer credit, are qualified 

5 to serve as members of the Commission. 

6 (3) CHAIRPERSON.—The Chairperson shall be 

7 appointed by the President, by and with the advice 

8 and consent of the Senate, from among the members 

9 of the Commission. An individual may serve as a 

10 member of the Commission and as Chairperson at 

11 the same time. 

12 (4) REMOVAL.—Any member of the Commis13 sion may be removed by the President for neglect of 

14 duty or malfeasance in office, but for no other cause. 

15 (b) TERM; VACANCIES.— 

16 (1) IN GENERAL.—Except as provided in para17 graph (2)— 

18 (A) the Commissioners first appointed 

19 under this section shall be appointed for terms 

20 ending 3, 4, 5, 6, and 7 years, respectively, 

21 after the date of enactment of this Act, the 

22 term of each to be designated by the President 

23 at the time of nomination; and 

24 (B) each of their successors shall be ap25 pointed for a term of 5 years from the date of 


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1 the expiration of the term for which the prede2 cessor was appointed. 

3 (2) LIMITATIONS.—Any Commissioner ap4 pointed to fill a vacancy occurring prior to the expi5 ration of the term for which his predecessor was ap6 pointed shall be appointed only for the remainder of 

7 such term. A Commissioner may continue to serve 

8 after the expiration of this term until a successor 

9 has taken office, except that such Commissioner may 

10 not continue to serve more than 1 year after the 

11 date on which the term of that Commissioner would 

12 otherwise expire under this subsection. 

13 (c) RESTRICTIONS ON OUTSIDE ACTIVITIES.— 

14 (1) POLITICAL AFFILIATION.—Not more than 3 

15 of the Commissioners shall be affiliated with the 

16 same political party. 

17 (2) CONFLICTS OF INTEREST.—No individual 

18 may hold the office of Commissioner if that indi19 vidual— 

20 (A) is in the employ of, or holding any offi21 cial relation to, or married to any person en22 gaged in selling or devising consumer credit; 

23 (B) owns stock or bonds of substantial 

24 value in a person so engaged; 


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1 (C) is in any other manner pecuniarily in2 terested in such a person, or in a substantial 

3 supplier of such a person; or 

4 (D) engages in any other business, voca5 tion, or employment. 

6 (d) QUORUM; SEAL; VICE CHAIRPERSON.— 

7 (1) QUORUM.—No vacancy in the Commission 

8 shall impair the right of the remaining Commis9 sioners to exercise all the powers of the Commission, 

10 but 3 members of the Commission shall constitute a 

11 quorum for the transaction of business, except that 

12 if there are only 3 members serving on the Commis13 sion because of vacancies in the Commission, 2 

14 members of the Commission shall constitute a 

15 quorum for the transaction of business, and if there 

16 are only 2 members serving on the Commission be17 cause of vacancies in the Commission, 2 members 

18 shall constitute a quorum for the 6-month period (or 

19 the 1-year period, if the 2 members are not affiliated 

20 with the same political party) beginning on the date 

21 of the vacancy which caused the number of Commis22 sion members to decline to 2. 

23 (2) SEAL.—The Commission shall have an offi24 cial seal of which judicial notice shall be taken. 


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1 (3) VICE CHAIRPERSON.—The Commission 

2 shall annually elect a Vice Chairperson to act in the 

3 absence or disability of the Chairperson or in case 

4 of a vacancy in the office of the Chairperson. 

5 (e) OFFICES.—The Commission shall maintain a 

6 principal office and such field offices as it deems nec7 essary, and may meet and exercise any of its powers at 

8 any other place. 

9 (f) FUNCTIONS OF CHAIRPERSON; REQUEST FOR AP10 PROPRIATIONS.— 

11 (1) DUTIES.—The Chairperson of the Commis12 sion shall be the principal executive officer of the 

13 Commission, and shall exercise all of the executive 

14 and administrative functions of the Commission, in15 cluding functions of the Commission with respect 

16 to— 

17 (A) the appointment and supervision of 

18 personnel employed under the Commission (and 

19 the Commission shall fix their compensation at 

20 a level comparable to that for employees of the 

21 Securities and Exchange Commission); 

22 (B) the distribution of business among per23 sonnel appointed and supervised by the Chair24 person and among administrative units of the 

25 Commission; and 


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1 (C) the use and expenditure of funds. 

2 (2) GOVERNANCE.—In carrying out any of the 

3 functions of the Chairperson under this subsection, 

4 the Chairperson shall be governed by general policies 

5 of the Commission and by such regulatory decisions, 

6 findings, and determinations as the Commission 

7 may, by law, be authorized to make. 

8 (3) REQUESTS FOR APPROPRIATIONS.—Re9 quests or estimates for regular, supplemental, or de10 ficiency appropriations on behalf of the Commission 

11 may not be submitted by the Chairperson without 

12 the prior approval of the Commission. 

13 (g) AGENDA AND PRIORITIES; ESTABLISHMENT AND

14 COMMENTS.—At least 30 days before the beginning of 

15 each fiscal year, the Commission shall establish an agenda 

16 for Commission action under its jurisdiction and, to the 

17 extent feasible, shall establish priorities for such actions. 

18 Before establishing such agenda and priorities, the Com19 mission shall conduct a public hearing on the agenda and 

20 priorities, and shall provide reasonable opportunity for the 

21 submission of comments. 

22 SEC. 5. AUTHORIZATION OF APPROPRIATIONS. 

23 There are authorized to be appropriated for purposes 

24 of carrying out this Act such sums as may be necessary. 


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1 SEC. 6. OBJECTIVES AND RESPONSIBILITIES. 

2 (a) OBJECTIVES.—The objectives of the Commission 

3 are— 

4 (1) to minimize unreasonable consumer risk as5 sociated with buying and using consumer credit; 

6 (2) to prevent and eliminate unfair practices 

7 that lead consumers to incur unreasonable, inappro8 priate, or excessive debt, or make it difficult for con9 sumers to escape existing debt, including practices 

10 or product features that are abusive, fraudulent, un11 fair, deceptive, predatory, anticompetitive, or other12 wise inconsistent with consumer protection; 

13 (3) to promote practices that assist and encour14 age consumers to use credit responsibly, avoid exces15 sive debt, and avoid unnecessary or excessive 

16 charges derived from or associated with credit prod17 ucts; 

18 (4) to ensure that credit history is maintained, 

19 reported, and used fairly and accurately; 

20 (5) to maintain strong privacy protections for 

21 consumer credit transactions, credit history, and 

22 other personal information associated with the use of 

23 consumer credit; 

24 (6) to collect, investigate, resolve, and inform 

25 the public about consumer complaints regarding con26 sumer credit; 


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1 (7) to ensure a fair system of consumer dispute 

2 resolution in consumer credit; and 

3 (8) to take such other steps as are reasonable 

4 to protect consumers of credit products. 

5 (b) RESPONSIBILITIES.—The Commission shall— 

6 (1) promulgate consumer credit safety rules 

7 that— 

8 (A) ban abusive, fraudulent, unfair, decep9 tive, predatory, anticompetitive, or otherwise 

10 anti-consumer practices or product features for 

11 creditors; 

12 (B) place reasonable restrictions on con13 sumer credit practices or product features to re14 duce the likelihood that they may be provided 

15 in a manner that is inconsistent with the objec16 tives specified in subsection (a); and 

17 (C) establish requirements for such clear 

18 and adequate warnings or other information, 

19 and the form of such warnings or other infor20 mation, as may be appropriate to advance the 

21 objectives specified in subsection (a); 

22 (2) establish and maintain a best practices 

23 guide for all providers of consumer credit; 


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1 (3) conduct such continuing studies and inves2 tigations of consumer credit industry practices as it 

3 deems necessary; 

4 (4) award grants or enter into contracts for the 

5 conduct of such studies and investigations with any 

6 person (including a governmental entity); 

7 (5) following publication of an advance notice of 

8 proposed rulemaking, a notice of proposed rule9 making, or a rule under any rulemaking authority 

10 administered by the Commission, assist public and 

11 private organizations or groups of consumer credit 

12 providers, administratively and technically, in the de13 velopment of consumer credit safety standards or 

14 guidelines that would assist such providers in com15 plying with such rule; and 

16 (6) establish and operate a consumer credit cus17 tomer hotline which consumers can call to register 

18 complaints and receive information on how to com19 bat anti-consumer consumer credit. 

20 SEC. 7. COORDINATION OF ENFORCEMENT. 

21 (a) IN GENERAL.—Notwithstanding any concurrent 

22 or similar authority of any other agency, the Commission 

23 shall enforce the requirements of this Act. 

24 (b) RULE OF CONSTRUCTION.—The authority grant25 ed to the Commission to make and enforce rules under 


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1 this Act shall not be construed to impair the authority 

2 of any other Federal agency to make and enforce rules 

3 under any other provision of law, provided that any por4 tion of any rule promulgated by any other such agency 

5 that conflicts with a rule promulgated by the Commission 

6 and that is less protective of consumers than the rule pro7 mulgated by the Commission shall be superseded by the 

8 stronger rule promulgated by the Commission, to the ex9 tent of the conflict. Any portion of any rule promulgated 

10 by any other such agency that is not superseded by a rule 

11 promulgated by the Commission shall remain in force 

12 without regard to this Act. 

13 (c) AGENCY AUTHORITY.—Any agency designated in 

14 subsection (d) may exercise, for the purpose of enforcing 

15 compliance with any requirement imposed under this Act, 

16 any authority conferred on such agency by any other Act. 

17 (d) DESIGNATED AGENCIES.—The agencies des18 ignated in this subsection are— 

19 (1) the Board of Governors of the Federal Re20 serve System; 

21 (2) the Federal Deposit Insurance Corporation; 

22 (3) the Office of the Comptroller of the Cur23 rency; 

24 (4) the Office of Thrift Supervision; 

25 (5) the National Credit Union Administration; 


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1 (6) the Federal Housing Finance Authority; 

2 (7) the Federal Housing Administration; 

3 (8) the Secretary of Housing and Urban Devel4 opment; 

5 (9) the Federal Home Loan Bank Board; and 

6 (10) the Federal Trade Commission. 

7 SEC. 8. AUTHORITIES. 

8 (a) AUTHORITY TO CONDUCT HEARINGS OR OTHER

9 INQUIRIES.—The Commission may, by one or more of its 

10 members or by such agents or agency as it may designate, 

11 conduct any hearing or other inquiry necessary or appro12 priate to its functions anywhere in the United States. A 

13 Commissioner who participates in such a hearing or other 

14 inquiry shall not be disqualified solely by reason of such 

15 participation from subsequently participating in a decision 

16 of the Commission in the same matter. The Commission 

17 shall publish notice of any proposed hearing in the Federal 

18 Register, and shall afford a reasonable opportunity for in19 terested persons to present relevant testimony and data. 

20 (b) COMMISSION POWERS; ORDERS.—The Commis21 sion shall have the power— 

22 (1) to require, by special or general orders, any 

23 person to submit in writing such reports and an24 swers to questions as the Commission may prescribe 

25 to carry out a specific regulatory or enforcement 


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1 function of the Commission, and such submission 

2 shall be made within such reasonable period and 

3 under oath or otherwise as the Commission may de4 termine, and such order shall contain a complete 

5 statement of the reasons that the Commission re6 quires the report or answers specified in the order 

7 to carry out a specific regulatory or enforcement 

8 function of the Commission, and shall be designed to 

9 place the least burden on the person subject to the 

10 order as is practicable, taking into account the pur11 pose for which the order was issued; 

12 (2) to administer oaths; 

13 (3) to require by subpoena the attendance and 

14 testimony of witnesses and the production of all doc15 umentary evidence relating to the execution of its 

16 duties; 

17 (4) in any proceeding or investigation to order 

18 testimony to be taken by deposition before any per19 son who is designated by the Commission and has 

20 the power to administer oaths and, in such in21 stances, to compel testimony and the production of 

22 evidence in the same manner as authorized under 

23 paragraph (3); 


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1 (5) to pay witnesses the same fees and mileage 

2 as are paid in like circumstances in the courts of the 

3 United States; 

4 (6) to accept voluntary and uncompensated 

5 services relevant to the performance of the Commis6 sion’s duties, notwithstanding the provisions of sec7 tion 1342 of title 31, United States Code, and to ac8 cept voluntary and uncompensated services (but not 

9 gifts) relevant to the performance of the Commis10 sion’s duties, provided that any such services shall 

11 not be from parties that have or are likely to have 

12 business before the Commission; 

13 (7) to— 

14 (A) initiate, prosecute, defend, intervene 

15 in, or appeal (other than to the Supreme Court 

16 of the United States), through its own legal 

17 representative and in the name of the Commis18 sion, any civil action if the Commission makes 

19 a written request to the Attorney General of the 

20 United States for representation in such civil 

21 action and the Attorney General does not with22 in the 45-day period beginning on the date such 

23 request was made notify the Commission in 

24 writing that the Attorney General will represent 

25 the Commission in such civil action; and 


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1 (B) whenever the Commission obtains evi2 dence that any person, partnership, or corpora3 tion, either domestic or foreign, has engaged in 

4 conduct that may constitute a violation of Fed5 eral criminal law, including a violation of sec6 tion 11 of this Act, transmit such evidence to 

7 the Attorney General of the United States, who 

8 may institute criminal proceedings under appro9 priate statutes; and 

10 (8) to delegate any of its functions or powers, 

11 other than the power to issue subpoenas under para12 graph (3), to any officer or employee of the Commis13 sion. 

14 (c) NONCOMPLIANCE WITH SUBPOENA OR COMMIS15 SION ORDER; CONTEMPT.—Any United States district 

16 court within the jurisdiction of which any inquiry is car17 ried on, may, upon petition by the Commission (subject 

18 to subsection (b)(7)) or by the Attorney General of the 

19 United States, in case of refusal to obey a subpoena or 

20 order of the Commission issued under subsection (b), issue 

21 an order requiring compliance therewith. Any failure to 

22 obey the order of the court may be punished by the court 

23 as a contempt thereof. 

24 (d) DISCLOSURE OF INFORMATION.—No person shall 

25 be subject to civil liability to any person (other than the 


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1 Commission or the United States) for disclosing informa2 tion to the Commission. 

3 (e) CUSTOMER AND REVENUE DATA.—The Commis4 sion may by rule require any provider of consumer credit 

5 to provide to the Commission such customer and revenue 

6 data as may be required to carry out the purposes of this 

7 Act. 

8 (f) PURCHASE OF CONSUMER CREDIT BY COMMIS9 SION.—For purposes of carrying out this Act, the Com10 mission may purchase any consumer credit, and it may 

11 require any provider of consumer credit to sell the service 

12 to the Commission at cost. 

13 (g) CONTRACT AUTHORITY.—The Commission is au14 thorized to enter into contracts with governmental entities, 

15 private organizations, or individuals for the conduct of ac16 tivities authorized by this Act. 

17 (h) BUDGET ESTIMATES AND REQUESTS; LEGISLA18 TIVE RECOMMENDATIONS; TESTIMONY; COMMENTS ON

19 LEGISLATION.— 

20 (1) BUDGET COPIES TO CONGRESS.—Whenever 

21 the Commission submits any budget estimate or re22 quest to the President or the Office of Management 

23 and Budget, it shall concurrently transmit a copy of 

24 that estimate or request to the relevant congres25 sional committees. 


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1 (2) LEGISLATIVE RECOMMENDATION.—When2 ever the Commission submits any legislative rec3 ommendations, or testimony, or comments on legis4 lation to the President or the Office of Management 

5 and Budget, it shall concurrently transmit a copy 

6 thereof to the relevant congressional committees. No 

7 officer or agency of the United States shall have any 

8 authority to require the Commission to submit its 

9 legislative recommendations, or testimony, or com10 ments on legislation, to any officer or agency of the 

11 United States for approval, comments, or review, 

12 prior to the submission of such recommendations, 

13 testimony, or comments to the relevant congressional 

14 committees. 

15 SEC. 9. COLLABORATION WITH FEDERAL AND STATE ENTI16 TIES. 

17 (a) PREEMPTION.—Nothing in this Act or any rule 

18 promulgated thereunder may be construed to preempt any 

19 provision of State law that provides equal or greater pro20 tection to consumers than is provided in this Act. 

21 (b) PROGRAMS TO PROMOTE FEDERAL-STATE CO22 OPERATION.—The Commission shall establish a program 

23 to promote Federal-State cooperation for the purposes of 

24 carrying out this Act. In implementing such program, the 

25 Commission may— 


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1 (1) accept from any State or local authority en2 gaged in activities relating to consumer credit pro3 tection assistance in such functions as data collec4 tion, investigation, and educational programs, as 

5 well as other assistance in the administration and 

6 enforcement of this Act which such States or local7 ities may be able and willing to provide and, if so 

8 agreed, may pay in advance or otherwise for the rea9 sonable cost of such assistance; and 

10 (2) commission any qualified officer or em11 ployee of any State or local agency as an officer of 

12 the Commission for the purpose of conducting inves13 tigations. 

14 (c) COOPERATION OF FEDERAL DEPARTMENTS AND

15 AGENCIES.—The Commission may obtain from any Fed16 eral department or agency such statistics, data, program 

17 reports, and other materials as it may deem necessary to 

18 carry out its functions under this Act. Each such depart19 ment or agency shall cooperate with the Commission and, 

20 to the extent permitted by law, furnish such materials to 

21 it. The Commission and the heads of other departments 

22 and agencies engaged in administering programs related 

23 to consumer credit safety shall, to the maximum extent 

24 practicable, cooperate and consult in order to ensure fully 

25 coordinated efforts. 


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1 SEC. 10. PROCEDURES AND RULEMAKING. 

2 (a) COMMENCEMENT OF PROCEEDING; PUBLICATION

3 OF PRESCRIBED NOTICE OF PROPOSED RULEMAKING; 

4 TRANSMITTAL OF NOTICE.—A proceeding for the develop5 ment of a consumer credit safety rule shall be commenced 

6 by the publication in the Federal Register of an advance 

7 notice of proposed rulemaking which shall— 

8 (1) identify the objective or objectives specified 

9 in section 6(a) for the consumer credit safety rule; 

10 (2) include a summary of each of the regulatory 

11 alternatives under consideration by the Commission; 

12 (3) include information with respect to any ex13 isting voluntary standard known to the Commission 

14 which may be relevant to the proceedings, together 

15 with a summary of the reasons why the Commission 

16 believes preliminarily that such standard does not 

17 achieve an objective identified in paragraph (1); 

18 (4) invite interested persons to submit to the 

19 Commission, within such period as the Commission 

20 shall specify in the notice (which period shall not be 

21 shorter than 30 days or longer than 60 days after 

22 the date of publication of the notice), comments with 

23 respect to the proposed rulemaking, the regulatory 

24 alternatives being considered, and other possible al25 ternatives for achieving the objective or objectives 

26 identified in paragraph (1); and 


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1 (5) invite any person (other than the Commis2 sion) to submit to the Commission, within such pe3 riod as the Commission shall specify in the notice 

4 (which period shall not be less than 30 days after 

5 the date of publication of the notice), an existing 

6 voluntary standard or a portion of such a standard 

7 as a proposed consumer credit safety rule. 

8 (b) TRANSMITTAL TO CONGRESS.—The Commission 

9 shall transmit such notice within 10 calendar days to the 

10 relevant congressional committees. 

11 (c) VOLUNTARY STANDARD; PUBLICATION AS PRO12 POSED RULE; NOTICE OF RELIANCE OF COMMISSION ON

13 STANDARD.—If the Commission determines that any 

14 standard submitted to it in response to an invitation in 

15 a notice published under subsection (a)(5) if promulgated 

16 (in whole, in part, or in combination with any other stand17 ard submitted to the Commission or any part of such a 

18 standard) as a consumer credit safety rule, would achieve 

19 the objective or objectives identified in paragraph (1), the 

20 Commission may publish such standard, in whole, in part, 

21 or in such combination and with nonmaterial modifica22 tions, as a proposed consumer credit safety rule. 

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1 sion unless, not later than 60 days after the date of publi2 cation of the notice required in subsection (a), the Com3 mission publishes in the Federal Register the text of the 

4 proposed rule, including any alternatives, which the Com5 mission proposes to promulgate, together with a prelimi6 nary regulatory analysis containing— 

7 (1) a preliminary description of the potential 

8 benefits and potential costs of the proposed rule, in9 cluding any benefits or costs that cannot be quan10 tified in monetary terms, and an identification of 

11 those likely to receive the benefits and bear the 

12 costs; 

13 (2) a discussion of the reasons any standard or 

14 portion of a standard submitted to the Commission 

15 under subsection (a)(5) was not published by the 

16 Commission as the proposed rule or part of the pro17 posed rule; and 

18 (3) a description of any reasonable alternatives 

19 to the proposed rule, together with a summary de20 scription of their potential costs and benefits, and a 

21 brief explanation of why such alternatives should not 

22 be published as a proposed rule. 

23 (e) TRANSMITTAL OF NOTICE.—The Commission 

24 shall transmit such notice not later than 10 calendar days 


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1 after the date of publication of the notice to the relevant 

2 congressional committees. 

3 (f) FINAL ISSUANCE.—Any proposed consumer credit 

4 safety rule shall be issued within 12 months after the date 

5 of publication of an advance notice of proposed rulemaking 

6 under subsection (a) relating to the consumer credit in7 volved, unless the Commission determines that such pro8 posed rule is not a reasonable means of achieving the ob9 jective or objectives identified in subsection (a)(1) with re10 spect to such proposed rule or an objective specified in 

11 section 6(a), or is not in the public interest. The Commis12 sion may extend that 12-month period for good cause. If 

13 the Commission extends such period, it shall immediately 

14 transmit notice of such extension to the relevant congres15 sional committees. Such notice shall include an expla16 nation of the reasons for such extension, together with an 

17 estimate of the date by which the Commission anticipates 

18 such rulemaking will be completed. The Commission shall 

19 publish a notice of such extension and the information 

20 submitted to the Congress in the Federal Register. 

21 (g) PROMULGATION OF RULE.— 

22 (1) TIMING.—Not later than 60 days after the 

23 date of publication under subsection (c) of a pro24 posed consumer credit safety rule, the Commission 

25 shall— 


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1 (A) promulgate a consumer credit safety 

2 rule, if it makes the findings required under 

3 subsection (h); or 

4 (B) withdraw the applicable notice of pro5 posed rulemaking if it determines that such rule 

6 is not— 

7 (i) a reasonable means of achieving 

8 the objective or objectives identified in sub9 section (a)(1) with respect to such pro10 posed rule or an objective specified in sec11 tion 6(a); or 

12 (ii) in the public interest. 

13 (2) EXTENSION.—The Commission may extend 

14 such 60-day period in paragraph (1) for good cause 

15 shown (if it publishes its reasons therefore in the 

16 Federal Register). 

17 (3) TITLE 5.—Consumer credit safety rules 

18 shall be promulgated in accordance with section 553 

19 of title 5, United States Code, except that the Com20 mission shall give interested persons an opportunity 

21 for the oral presentation of data, views, or argu22 ments, in addition to an opportunity to make written 

23 submissions. A transcript shall be kept of any oral 

24 presentation. 


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1 (h) EXPRESSION OF OBJECTIVE; CONSIDERATION OF

2 AVAILABLE PRODUCT DATA; NEEDS OF ELDERLY AND

3 HANDICAPPED.— 

4 (1) OBJECTIVES.—A consumer credit safety 

5 rule shall express in the rule itself the objectives 

6 identified in subsection (a)(1) with respect to such 

7 rule. 

8 (2) CONSIDERATIONS.—In promulgating such a 

9 rule, the Commission shall— 

10 (A) consider relevant available data, in11 cluding the results of investigation activities 

12 conducted generally and pursuant to this Act; 

13 and 

14 (B) consider and take into account the 

15 special needs of elderly individuals and individ16 uals with disabilities to determine the extent to 

17 which such persons may be affected by such 

18 rule. 

19 (i) FINDINGS; FINAL REGULATORY ANALYSIS; JUDI20 CIAL REVIEW OF RULE.— 

21 (1) FINDINGS.—Prior to promulgating a con22 sumer credit safety rule, the Commission shall con23 sider, and shall make appropriate findings for inclu24 sion in such rule with respect to— 


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1 (A) the degree and nature of the benefit to 

2 consumer protection that the rule is designed to 

3 achieve or promote; 

4 (B) the approximate number of consumer 

5 credit products, or types or classes thereof, sub6 ject to such rule; 

7 (C) the need of the public for the con8 sumer credit product subject to such rule, and 

9 the probable effect of such rule upon the utility, 

10 cost, or availability of such services to meet 

11 such need; and 

12 (D) any means of achieving the objective of 

13 the order while minimizing adverse effects on 

14 competition or disruption or dislocation of the 

15 provision of consumer credit. 

16 (2) REGULATORY ANALYSIS.—The Commission 

17 shall not promulgate a consumer credit safety rule, 

18 unless it— 

19 (A) has prepared, on the basis of the find20 ings of the Commission under paragraph (1) 

21 and on other information before the Commis22 sion, a final regulatory analysis of the rule con23 taining— 

24 (i) a description of the potential bene25 fits and potential costs of the rule, includVerDate Aug 31 2005 03:11 Oct 03, 2008 Jkt 079200 PO 00000 Frm 00027 Fmt 6652 Sfmt 6201 E:\BILLS\S3629.IS S3629

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1 ing costs and benefits that cannot be quan2 tified in monetary terms, and the identi3 fication of those likely to receive the bene4 fits and bear the costs; 

5 (ii) a description of any alternatives to 

6 the final rule which were considered by the 

7 Commission, together with a brief expla8 nation of the reasons why these alter9 natives were not chosen; and 

10 (iii) a summary of any significant 

11 issues raised by the comments submitted 

12 during the public comment period in re13 sponse to the preliminary regulatory anal14 ysis, and a summary of the assessment by 

15 the Commission of such issues; 

16 (B) finds (and includes such finding in the 

17 rule)— 

18 (i) that the rule (including its effective 

19 date) is reasonably appropriate to achieve 

20 an objective identified in subsection (a)(1) 

21 with respect to such proposed rule or speci22 fied in section 6(a); 

23 (ii) that the promulgation of the rule 

24 is in the public interest; and 


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1 (iii) that the benefits expected from 

2 the rule bear a reasonable relationship to 

3 its costs. 

4 (3) PUBLICATION.—The Commission shall pub5 lish its final regulatory analysis with the rule. 

6 (4) LIMIT ON JUDICIAL REVIEW.—Any prelimi7 nary or final regulatory analysis prepared under 

8 subsection (c) or (i)(2) shall not be subject to inde9 pendent judicial review, except that when an action 

10 for judicial review of a rule is instituted, the con11 tents of any such regulatory analysis shall constitute 

12 part of the whole rulemaking record of agency action 

13 in connection with such review. The provisions of 

14 this paragraph shall not be construed to alter the 

15 substantive or procedural standards otherwise appli16 cable to judicial review of any action by the Commis17 sion. 

18 (j) EFFECTIVE DATE.—Each consumer credit safety 

19 rule shall specify the date on which such rule is to take 

20 effect, not to exceed 180 days from the date on which it 

21 is issued in final form, unless the Commission finds, for 

22 good cause shown, that a later effective date is in the pub23 lic interest and publishes its reasons for such finding. The 

24 effective date of a consumer credit safety rule under this 

25 Act shall be set at a date that is at least 30 days after 


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1 the date of issuance in final form, unless the Commission 

2 for good cause shown determines that an earlier effective 

3 date is in the public interest. In no case may the effective 

4 date be set at a date which is earlier than the date of 

5 issuance in final form. 

6 (k) AMENDMENT OR REVOCATION OF RULE.—The 

7 Commission may, by rule, amend or revoke any consumer 

8 credit safety rule. Such amendment or revocation shall 

9 specify the date on which it is to take effect, which shall 

10 not exceed 180 days from the date on which the amend11 ment or revocation is published, unless the Commission 

12 finds for good cause shown that a later effective date is 

13 in the public interest and publishes its reasons for such 

14 finding. Where an amendment involves a material change 

15 in a consumer credit safety rule, subsections (a) through 

16 (h) shall apply. In order to revoke a consumer credit safety 

17 rule, the Commission shall publish a proposal to revoke 

18 such rule in the Federal Register, and allow oral and writ19 ten presentations in accordance with subsection (d)(2). 

20 The Commission may revoke such rule only if it deter21 mines that the rule is not a reasonable means of achieving 

22 an objective identified in subsection (a)(1) with respect to 

23 such proposed rule or an objective specified in subsection 

24 6(a). 


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1 (l) PETITION TO INITIATE RULEMAKING.—The Com2 mission shall grant, in whole or in part, or deny any peti3 tion under section 553 (e) of title 5, United States Code, 

4 requesting the Commission to initiate a rulemaking, with5 in a reasonable time after the date on which such petition 

6 is filed. The Commission shall state the reasons for grant7 ing or denying such petition. 

8 SEC. 11. PROHIBITED ACTS. 

9 It shall be unlawful for any person— 

10 (1) to advertise for or offer for sale any con11 sumer credit which is not in conformity with an ap12 plicable consumer credit safety rule under this Act; 

13 (2) to advertise for or offer for sale any con14 sumer credit— 

15 (A) which has been declared a banned 

16 product by a rule under this Act; 

17 (B) in a manner that does not comply with 

18 any requirements for the provision of any warn19 ings or other information regarding such credit; 

20 or 

21 (3) to fail or refuse to permit access to or copy22 ing of records, or fail or refuse to establish or main23 tain records, or fail or refuse to make reports or 

24 provide information to the Commission as required 


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1 under this Act or any rule thereunder, other than 

2 section 9. 

3 SEC. 12. PENALTIES FOR VIOLATIONS. 

4 (a) CRIMINAL PENALTIES.— 

5 (1) KNOWING AND WILLFUL VIOLATIONS.—Any 

6 person who knowingly and willfully violates section 

7 11 after having received notice of noncompliance 

8 from the Commission shall be fined not more than 

9 $500,000 or be imprisoned not more than one year, 

10 or both. 

11 (2) EXECUTIVES AND AGENTS.—Any individual 

12 director, officer, or agent of a corporation who 

13 knowingly and willfully authorizes, orders, or per14 forms any of the acts or practices constituting in 

15 whole or in part a violation of section 11, and who 

16 has knowledge of notice of noncompliance received 

17 by the corporation from the Commission, shall be 

18 subject to penalties under this section, without re19 gard to any penalties to which that corporation may 

20 be otherwise subject. 

21 (b) CIVIL PENALTIES.— 

22 (1) IN GENERAL.—Any person who violates sec23 tion 11 shall be subject to a civil penalty to be estab24 lished at the discretion of the Commission. A viola25 tion of section 11 shall constitute a separate civil ofVerDate Aug 31 2005 03:11 Oct 03, 2008 Jkt 079200 PO 00000 Frm 00032 Fmt 6652 Sfmt 6201 E:\BILLS\S3629.IS S3629

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1 fense with respect to each consumer credit trans2 action involved. 

3 (2) PUBLICATION OF SCHEDULE OF PEN4 ALTIES.—Not later than December 1, 2009, and De5 cember 1 of each fifth calendar year thereafter, the 

6 Commission shall prescribe and publish in the Fed7 eral Register a schedule of maximum authorized 

8 penalties that shall apply for violations that occur 

9 after January 1 of the year immediately following 

10 such publication. 

11 (3) RELEVANT FACTORS IN DETERMINING

12 AMOUNT OF PENALTY.—In determining the amount 

13 of any penalty to be sought upon commencing an ac14 tion seeking to assess a penalty for a violation of 

15 section 11, the Commission shall consider the nature 

16 of the consumer credit product or service, the sever17 ity of the unreasonable risk to the consumer, the 

18 number of products or services sold or distributed, 

19 and the appropriateness of such penalty in relation 

20 to the size of the business of the person charged. 

21 (4) COMPROMISE OF PENALTY; DEDUCTIONS

22 FROM PENALTY.—Any civil penalty under this sec23 tion may be compromised by the Commission. In de24 termining the amount of such penalty or whether it 

25 should be remitted or mitigated and in what 


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1 amount, the Commission shall consider the appro2 priateness of such penalty to the size of the business 

3 of the person charged, the nature of the consumer 

4 credit, the severity of the unreasonable risk to the 

5 consumer, the occurrence or absence of consumer in6 jury, and the number of offending products or serv7 ices sold. The amount of such penalty when finally 

8 determined, or the amount agreed on compromise, 

9 may be deducted from any sums owing by the 

10 United States to the person charged. 

11 (c) COLLECTION AND USE OF PENALTIES.—The 

12 Commission shall retain ownership over criminal and civil 

13 fees collected and shall apply these fees to defray the costs 

14 of the Commission’s operation or, where appropriate, pro15 vide restitution for harmed consumers. 

16 SEC. 13. REPORTS. 

17 (a) REPORTS TO THE PUBLIC.—The Commission 

18 shall determine what reports should be produced and dis19 tributed to the public on a recurring and ad hoc basis, 

20 and shall prepare and publish such reports on a web site 

21 that provides free access to the general public. 

22 (b) REPORT TO PRESIDENT AND CONGRESS.—The 

23 Commission shall prepare and submit to the President and 

24 the relevant congressional committees at the beginning of 

25 each regular session of Congress a comprehensive report 


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1 on the administration of this Act for the preceding fiscal 

2 year. Such report shall include— 

3 (1) a thorough appraisal, including statistical 

4 analyses, estimates, and long-term projections, of the 

5 incidence and effects of practices associated with the 

6 provision of consumer credit that are inconsistent 

7 with the objectives specified in section 6(a), with a 

8 breakdown, insofar as practicable, among the var9 ious sources of injury as the Commission finds ap10 propriate; 

11 (2) a list of consumer credit safety rules pre12 scribed or in effect during such year; 

13 (3) an evaluation of the degree of observance of 

14 consumer credit safety rules, including a list of en15 forcement actions, court decisions, and compromises 

16 of civil penalties, by location and company name; 

17 (4) a summary of outstanding problems con18 fronting the administration of this Act in order of 

19 priority; 

20 (5) an analysis and evaluation of public and 

21 private consumer credit safety research activities; 

22 (6) a list, with a brief statement of the issues, 

23 of completed or pending judicial actions under this 

24 Act; 


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1 (7) the extent to which technical information 

2 was disseminated to the scientific and consumer 

3 credit communities and consumer information was 

4 made available to the public; 

5 (8) the extent of cooperation between Commis6 sion officials and representatives of industry and 

7 other interested parties in the implementation of this 

8 Act, including a log or summary of meetings held 

9 between Commission officials and representatives of 

10 industry and other interested parties; 

11 (9) an appraisal of significant actions of State 

12 and local governments relating to the responsibilities 

13 of the Commission; 

14 (10) with respect to voluntary consumer credit 

15 safety standards promulgated as consumer safety 

16 rules under section 10(c), a description of— 

17 (A) the number of such standards adopted 

18 as rules; and 

19 (B) the nature and number of the con20 sumer credit products and services which are 

21 the subject of such adopted rules and the ap22 proximate number of consumers affected; 

23 (11) such recommendations for additional legis24 lation as the Commission deems necessary to carry 

25 out the purposes of this Act; and 


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1 (12) the extent of cooperation with and the 

2 joint efforts undertaken by the Commission in con3 junction with other regulators with whom the Com4 mission shares responsibilities for consumer credit 

5 safety. 

6 SEC. 14. EFFECTIVE DATE. 

7 This Act shall be effective 120 days after the date 

8 of enactment of this Act. 

Æ 


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