An Act to increase deposit insurance from $20,000 to $40,000, to provide full insurance for public unit deposits of $100,000 per account, to establish a National Commission on Electronic Fund Transfers, and for other purposes.
PL 93-495 (H.R.11221), enacted 10/28/1974

1500 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
amended by striking the semicolon and the word "the" after the words 
"section 250 of title 28" and inserting in lieu thereof a colon and the 
following: ''''Provided^ That expenditures for food, rations, or pro-
visions shall not be deemed payments on the claim. The". 
Approved October 27, 1974. 
October 28, 1974 
[H.R. 11221] 
Public Law 93-495 
AN ACT 
To increase deposit insurance from $20,000 to $40,000, to provide full insurance 
for public unit deposits of $100,000 per account, to establish a National 
Commission on Electronic Fund Transfers, and for other purposes. 
Be it enacted by the Senate and House of Representatives 
of the 
Federal deposit United States of America in Congress assembled^ 
insurance, 
crease. 
TITLE I—AMENDMENTS TO AND EXTENSIONS OF PRO-
VISIONS OF LAW RELATING TO FEDERAL REGULA-
TION OF DEPOSITORY INSTITUTIONS 
12 u s e 181 
note. 
Infra. 
Insured ba 
public funds 
coverage. 
nks, 
in. 
FULL DEPOSIT INSURANCE FOR PUBLIC UNITS 
SECTION 101. (a) The Federal Deposit Insurance Act is amended— 
(1) in subsection (m) of section 3 (12 U.S.C. 1813(m)), by 
inserting immediately after "depositor" in the first sentence the 
following: "(other than a depositor referred to in the third sen-
tence of this subsection)"; 
(2) in subsection (i) of section 7 (12 U.S.C. 1817(i)), by strik-
ing out "Trust" and inserting in lieu thereof the following: 
"Except with respect to trust funds which are owned by a deposi-
tor referred to in paragraph (2) of section 11(a) of this Act, 
trust"; and 
(3) in subsection (a) of section 11 (12 U.S.C. 1821(a)), by 
inserting "(1)" immediately after "(a)", by striking out "The" 
in the last sentence and inserting in lieu thereof the following: 
"Except as provided in paragraph (2), the", and by inserting at 
the end of such subsection the following: 
" (2) (A) Notwithstanding any limitation in this Act or in any other 
provision of law relating to the amount of deposit insurance available 
for the account of any one depositor, in the case of a depositor who is— 
"(i) an officer, employee, or agent of the United States having 
official custody of public funds and lawfully investing or deposit-
ing the same in time and savings deposits in an insured bank; 
"(ii) an officer, employee, or agent of any State of the United 
States, or of any county, municipality, or political subdivision 
thereof having official custody of public funds and lawfully 
investing or depositing the same in time and savings deposits in 
an insured bank in such State; 
"(iii) an officer, employee, or agent of the District of Columbia 
having official custody of public funds and lawfully investing or 
depositing the same in time and savings deposits in an insured 
bank in the District of Columbia; or 
"(iv) an officer, employee, or agent of the Commonwealth of 
Puerto Rico, of the Virgin Islands, of American Samoa, or of 
Guam, or of any county, municipality, or political subdivision 
thereof having official custody of public funds and lawfully invest-
ing or depositing the same in time and savings deposits in a.n 
insured bank in the Commonwealth of Puerto Rico, the Virgin 
Islands, American Samoa, or Guam, respectively; 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1501 
his deposit shall be insured in an amount not to exceed $100,000 per 
account. 
"(b) The Corporation may limit the aggregate amount of funds that 
may be invested or deposited in time and savings deposits in any 
insured bank by any depositor referred to in subparagraph (A) of 
this paragraph on the basis of the size of any such bank in terms of its 
assets: Provided^ however^ such limitation may be exceeded by the 
pledging of acceptable securities to the depositor referred to in sub-
paragraph (A) of this paragraph when and where required." 
(b) Title IV of the National Housing Act is amended— 
loarasloclf 
(1) in section 401(b) (12 U.S.C. 1724(b)), by striking out tio^ns?pubuc' 
"Funds" in the third sentence and inserting in lieu thereof the ^""'^^ ^"' ''°^-
following: "Except in the case of an insured member referred to 
in the preceding sentence, funds"; 
(2) in section 405(a) (12 U.S.C. 1728(a)), by inserting after 
"except that no member or investor" the following: "(other than 
a member or investor referred to in subsection (d))"; and 
(3) by adding at the end of section 405 (12 U.S.C. 1728) the 
following new subsection: 
"(d)(1) Notwithstanding any limitation in this subchapter or in 
any other provision of law relating to the amount of deposit insurance 
available for any one account, in the case of an insured member who 
is— 
"(i) an officer, employee, or agent of the United States having 
official custody of public funds and lawfully investing the same 
in an insured institution; 
"(ii) an officer, employee, or agent of any State of the United 
States, or of any county, municipality, or political subdivision 
thereof having official custody of public funds and lawfully 
investing the same in an insured institution in such State; 
" (iii) an officer, employee, or agent of the District of Columbia 
having official custody of public funds and lawfully investing the 
same in an insured institution in the District of Columbia; or 
"(iv) an officer, employee, or agent of the Commonwealth of 
Puerto Rico, or of the Virgin Islands, or of any county, munici-
pality, or political subdivision thereof having official custody of 
public funds and lawfully investing the same in an insured insti-
tution in the Commonwealth of Puerto Rico or the Virgin Islands, 
respectively; 
the account of such insured member shall be insured in an amount not 
to exceed $100,000 per account. 
"(2) The Corporation may limit the aggregate amount of funds 
that may be invested in any insured institution by any insured mem-
ber referred to in paragraph (1) of this subsection on the basis of the 
size of any such institution in terms of its assets." 
(c) Subsection (c) of section 207 of the Federal Credit Union Act 
Credit unions, 
(12 U.S.C. 1787) is amended by— 
(1) inserting "(1)" after "(c)", 
(2) striking out "For the purposes of this subsection," and 
inserting in lieu thereof the following: "Subject to the provisions 
of paragraph (2), for the purposes of this subsection,", and 
(3) adding at the end thereof the following: 
"(2) (A) Notwithstanding any limitation in this Act or in any 
other provision of law relating to the amount of insurance available 
for the account of any one depositor or member, in the case of a 
depositor or member who is— 
"(i) an officer, employee, or agent of the United States having 
official custody of public funds and lawfully investing the same 
in a credit union insured in accordance with this title; 
"(ii) an officer, employee, or agent of any State of the United 
public funds in, 
coverage. 
1502 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
12 u s e 1464. 
Study. 
42 u s e 4275 
note. 
Report to 
Congress. 
12 u s e 1813 
note. 
States, or of any county, municipality, or political subdivision 
thereof having official custody of public funds and lawfully 
investing the same in a credit union insured in accordance with 
this title in such State; 
"(iii) an officer, employee, or agent of the District of Columbia 
having official custody of public funds and lawfully investing the 
same in a credit union insured in accordance with this title in the 
District of Columbia; or 
"(iv) an officer, employee, or agent of the Commonwealth of 
Puerto Rico, of the Panama Canal Zone, or of any territory or 
possession of the United States, or of any county, municipality, 
or political subdivision thereof having official custody of public 
funds and lawfully investing the same in a credit union insured 
in accordance with this title in the Commonwealth of Puerto Rico, 
the Panama Canal Zone, or any such territory or possession, 
respectively; 
his account shall be insured in an amount not to exceed $100,000 per 
account. 
"(B) The Administrator may limit the aggregate amount of funds 
that may be invested or deposited in any credit union insured in 
accordance with this title by any depositor or member referred to in 
subparagraph (A) on the basis of the size of any such credit union 
in terms of its assets." 
(d) Section 107(7) of the Federal Credit Union Act (12 U.S.C. 
1757(7)) is amended by adding at the end thereof the following: 
"and to receive from an officer, employee, or agent of those nonmember 
units of Federal, State, or local governments and political subdivisions 
thereof enumerated in section 207 of this Act (12 U.S.C. 1787) and 
in the manner so prescribed payments on shares, share certificates, and 
share deposits;". 
(e) Section 5(b)(2) of the Home Owners' Loan Act of 1933 is 
amended by inserting immediately after "security," "may be surety as 
defined by the Board". 
(f) (1) The Advisory Commission on Intergovernmental Relations 
(hereinafter referred to as the "Commission") shall conduct a study 
of the impact of this section on funds available for housing and on 
State and local bond markets. 
(2) The Commission shall make a report to the Congress of the 
results of its study not later than two years after the date of enactment 
of this Act. 
(3) There is authorized to be appropriated to the Commission such 
sums as may be necessary to carry out this subsection. 
(g) This section and the amendments made by it shall take effect 
on the thirtieth day beginning after the date of enactment of this Act. 
12 
note. use 1813 
Effective date. 
12 
note use 1813 
INCREASED CEILING ON DEPOSIT INSURANCE: FEDERAL DEPOSIT INSURANCE 
CORPORATION 
SEC. 102. (a) The following provisions of the Federal Deposit Insur-
ance Act are amended by striking out "$20,000" each place it appears 
therein and inserting in lieu thereof "$40,000": 
(1) The first sentence of section 3 (m) (12 U.S.C. 1813 (m)). 
(2) The first sentence of section 7(i) (12 U.S.C. 1817(i)). 
(3) The last sentence of section 11(a) (12 U.S.C. 1821(a)). 
(4) The fifth sentence of section 11 (i) (12 U.S.C. 1821 (i)). 
(b) The amendments made by this section are not applicable to 
any claim arising out of the closing of a bank prior to the effective 
date of this section. 
(c) The amendments made by this section shall take effect on the 
thirtieth day beginning after the date of enactment of this Act. 
note. 
Effective date. 
12 u s e 1787 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1503 
INCREASED CEILING ON DEPOSIT INSURANCE : FEDERAL SAVINGS AND LOAN 
INSURANCE 
CORPORATION 
SEC. 103. (a) The following provisions of title IV of the National 
Housing Act are amended by striking out "$20,000" each place it 
^^ use 1724. 
appears therein and inserting in lieu thereof "$40,000": 
(1) Section 401(b) (12 U.S.C. 1724(b)). 
(2) Section405(a) (12U.S.C. 1728(a)). 
(b) The amendments made by this section are not applicable to 
1
2 use 1724 
any claim arising out of a default, as defined in section 401(d) of the 
National Housing Act, where the appointment of a conservator, 
receiver, or other legal custodian as set forth in that section becomes 
effective prior to the effective date of this section. 
(c) The amendments made by this section shall take effect on the 
f2^u'sc'^ 1
7
^
2
4
*
^
' 
thirtieth day beginning after the date of enactment of this Act. 
note. 
INCREASED CEILING ON DEPOSIT INSURANCE : INSURED CREDIT UNIONS 
SEC. 104. (a) The first sentence of section 207(c) of title I I of the 
Federal Credit Union Act (12 U.S.C. 1787 (c)) is amended by strik-
ing out "$20,000" and inserting in lieu thereof "$40,000". 
(b) The amendment made by this section is not applicable to any 
1
2 use 1737 
claim arising out of the closing of a credit union for liquidation on 
account of bankruptcy or insolvency pursuant to section 207 of title I I 
of the Federal Credit Union Act (12 U.S.C. 1787) prior to the effective 
date of this section. 
(c) The amendment made by this section shall take effect on the 
thirtieth day beginning after the date of enactment of this Act. 
note. 
CONVERSION OF SAVINGS AND LOAN ASSOCIATIONS 
SEC. 105. (a) Section 403(b) of the National Housing Act, as 
amended (12 U.S.C. 1726(b)), is amended by adding at the end 
thereof the following new sentence: "As used in this subsection the term 
"Reserves." 
'reserves' shall, to such extent as the Corporation may provide, include 
capital stock and other items, as defined by the Corporation.". 
(b) Section 12 (i) of the Securities Exchange Act of 1934, as 
amended (15 U.S.C. 781 (i)), is amended to read as follows: 
"(i) In respect of any securities issued by banks the deposits of 
which are insured in accordance with the Federal Deposit Insurance 
Act or institutions the accounts of which are insured by the Federal 
12 use is 11 
Savings and Loan Insurance Corporation, the powers, functions, and "°*^" 
duties vested in the Commission to administer and enforce sections 12, 
13, 14(a), 14(c), 14(d), 14(f), and 16, (1) with respect to national ^^^^ use 78^ 
banks and banks operating under the Code of Law for the District 
of Columbia are vested in the Comptroller of the Currency, (2) with 
respect to all other member banks of the Federal Eeser\ie System are 
vested in the Board of Governors of the Federal Reserve System, 
(3) with respect to all other insured banks are vested in the Federal 
Deposit Insurance Corporation, and (4) with respect to institutions 
the accounts of which are insured by the Federal Savings and Loan 
Insurance Corporation are vested in the Federal Home Loan Bank 
Board. The Comptroller of the Currency, the Board of Governors of 
the Federal Reserve System, the Federal Deposit Insurance Corpora-
tion, and the Federal Home Loan Bank Board shall have the power 
to make such rules and regulations as may be necessary for the execu-
tion of the functions vested in them as provided in this subsection. 
In carrying out their responsibilities under this subsection, the 
agencies named in the first sentence of this subsection shall issue sub-
stantially similar regulations to regulations and rules issued by the 
78m, 78n, 78p. 
1504 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
7
8
m "iln ^
7
8
^
' 
Commisslon under sections 12, 13, 14(a), 14(c), 14(d), 14(f) and 16, 
™
' "' 
^' 
unless they find that implementation of substantially similar regula-
tions with respect to insured banks and insured institutions are not 
necessary or appropriate in the public interest or for protection of 
Publication in 
invcstors, and publish such findings, and the detailed reasons therefor, 
F^ederai Regis- 
-^ ^^^ Federal Registcr. Such regulations of the above-named agencies, 
or the reasons for failure to publish such substantially similar regula-
tions to those of the Commission, shall be published in the Federal 
Register within 120 days of the date of enactment of this subsection, 
and, thereafter, within 60 days of any changes made by the Com-
mission in its iielevant regulations and rules." 
(c) Paragraph (5) of subsection (1) of section 407 of the National 
Housing Act, as amended (12 U.S.C. 1730(1) (5)), is amended by 
inserting after "disclosures" a comma and the following: "including 
proxy statements and the solicitation of proxies thereby,". 
(d) Subsection (j) of section 402 of the National Housing Act, as 
amended (12 LT.S.C. 1725 (j)), is amended to read as follows: 
"(j)(l) Except as otherwise provided in this subsection, until 
June 30, 1976, the Corporation shall not approve, under regulations 
adopted pursuant to this title or section 5 of the Home Owners' Loan 
1
2 use 1464. 
^QI of 1933^ by order or otherwise, a conversion from the mutual to 
stock form of organization involving or to involve an insured insti-
tution, except that this sentence shall not be deemed to limit now or 
hereafter the authority of the Corporation to approve conversions in 
supervisory cases. The Corporation may by rule, regulation, or other-
wise and under such civil penalties (which may be cumulative to any 
other remedies) as it may prescribe take whatever action it deems 
necessary or appropriate to implement or enforce this subsection. 
(2) The number of applications for conversion which the Corpora-
tion may approve pursuant to such regulations prior to such date 
shall be determined by the Corporation but shall not in any case 
be in excess of 1 per centum of the total number of all insured institu-
tions in existence on the date of enactment, exclusive of the number 
of applications submitted for filing prior to May 22, 1973. Provided, 
that the Corporation shall process to final determination any applica-
tion submitted for filing prior to May 22,1973, pursuant to regulations 
in effect and adopted pursuant to thi& title or section 5 of the Home 
Owners' Loan Act of 1933: with further proviso that, with respect 
to a plan of conversion of any such applicant which, before May 22, 
1973, has given written public notice to its accountholders of adoption 
of a plan of conversion or has obtained waiver forms from substan-
tially all its new accountholders subsequent to the giving of such 
notice, such plan need not require payment for stock distributed to 
accountholders as of a record date prior to the date of such notice. 
"(3) Notwithstanding any other provision of law, an insured insti-
tution converting in accordance with this subsection may retain its 
Federal charter. The Corporation shall not, however, permit the 
conversion of Federally chartered associations in States the laws of 
which do not authorize the operation of State chartered stock associa-
tions, except that the prohibition contained in this sentence shall not 
apply to the District of Columbia, the Commonwealth of Puerto Rico, 
or a State where all insured institutions domiciled therein are Fed-
erally chartered. 
"(4) Any aggrieved person may obtain review of a final action of 
the Federal Home Loan Bank Board or the Corporation which 
approves, with or without conditions, or disapproves a plan of con-
version pursuant to this subsection only by complying with the pro-
visions of subsection (k) of section 408 of this title (12 U.S.C. 
1730a (k)) within the time limit and in the manner therein prescribed, 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1505 
which provisions shall apply in all respects as if such final action were 
an order the review of which is therein provided for, except that such F^de^i'i'^R^egrs-" 
time limit shall commence upon publication of notice of such final ter. 
action in the Federal Register or upon the giving of such general 
notice of such final action as is required by or approved under regula-
tions of the Corporation, whichever is later. 
"(5) The Corporation shall, at least annually and more often as ^^9°'-^^ t° 
circumstances require, render reports to the Congress on the exercise 
of its authority under this subsection. 
"(6) In implementing the provisions of this subsection the Corpora-
tion shall regulate the approvals granted so as to achieve (A) as much 
geographical dispersion as practicable; (B) an equitable distribution 
with respect to the size of converting institutions; (C) an appropriate 
distribution between State chartered and Federally chartered institu-
tions; (D) timeliness of filing; (E) flexibility to the extent possible 
in plans of conversion taking into account the characteristics of par-
ticular converting institutions; (F) the meeting of capital needs; and 
(G) such other reasonable results as it may consider necessary or 
appropriate in the public interest." 
MORATORIUM ON CONVERSION OF FEDERAL DEPOSIT INSURANCE 
CORPORATION INSURED INSTITUTIONS 
SEC. 106, Section 18(c) of the Federal Deposit Insurance Act (12 
U.S.C. 1828(c)) is amended by adding at the end thereof the follow-
ing new subsection: 
"(10) Until June 30, 1976, the responsible agency shall not grant 
any approval required by law which has the practical eifect of per-
mitting a conversion from the mutual to the stock form of organiza-
tion, including approval of any application pending on the date of 
enactment of this subsection, except that this sentence shall not be 
deemed to limit now or hereafter the authority of the responsible 
agency to grant approvals in cases where the responsible agency finds 
that it must act in order to maintain the safety, soundness, and stability 
of an insured bank. The responsible agency may by rule, regulation, or 
otherwise and under such civil penalties (which shall be cumulative to 
any other remedies) as it may prescribe take whatever action it deems 
necessary or appropriate to implement or enforce this subsection." 
EXTENSION OF FLEXIBLE REGULATION OF INTEREST RATES 
AUTHORITY 
SEC 107. Section 7 of the Act of September 21, 1966 (Public Law 
89-597), is amended by striking out "December 31,1974" and inserting _if use 46i 
in lieu thereof "December 31,1975". 
INCREASE DOLLARS LIMITATION ON T H E COST FOR CONSTRUCTION OF 
FEDERAL RESERVE BANK BRANCH 
BUILDINGS 
SEC. 108. The ninth paragraph of section 10 of the Federal Reserve 
Act, as amended (12 U.S.C. 522), is amended by striking out 
"$60,000,000" and inserting in lieu thereof "$140,000,000". 
PURCHASE OF UNITED STATES OBLIGATIONS BY FEDERAL RESERVE BANKS 
SEC. 109. (a) Section 14(b) of the Federal Reserve Act, as 
amended (12 U.S.C. 355), is amended by striking out "November 1, 
1973" and inserting in lieu thereof "November 1,1975" and by striking 
out "October 31,1973" and inserting in lieu thereof "October 31,1976". 
note. 
1506 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
SUPERVISORY AUTHORITY OF THE BOARD OF GOVERNORS OF T H E FEDERAL 
RESERVE SYSTEM OVER BANK HOLDING COMPANIES AND THEIR 
N O N -
BANKING 
SUBSIDIARIES 
SEC. 110. Subsection (b) of section 8 of the Federal Deposit Insur-
ance Act, as amended (12 U.S.C. 1818(b)), is amended by adding at the 
end thereof the following new paragraph: 
"(3) This subsection and subsections (c), (d), (h), (i), (k), (1), 
(m), and (n) of this section shall apply to any bank holding company, 
and to any subsidiary (other than a bank) of a holding company, as 
12 use 1841 
those terms are defined in the Bank Holding Company Act of 1956, in 
the same manner as they apply to a State member insured bank." 
note 
INDEPENDENCE OF FINANCIAL REGULATORY AGENCIES 
12 use 250. 
S E C 111. No officer or agency of the United States shall have any 
authority to require the Securities and Exchange Commission, the 
Board of Governors of the Federal Reserve System, the Federal 
Deposit Insurance Corporation, the Federal Home Loan Bank Board, 
or the National Credit Union Administration to submit legislative 
recommendations, or testimony, or comments on legislation, to any 
officer or agency of the United States for approval, comments, or 
review, prior to the submission of such recommendations, testimony, or 
comments to the Congress if such recommendations, testimony, or com-
ments to the Congress include a statement indicating that the views 
expressed therein are those of the agency submitting them and do not 
necessarily represent the views of the President. 
I N C R E A S E I N A U T H O R I T Y O F T H E TREASURY TO PURCHASE FEDERAL HOME 
LOAN BANK 
OBLIGATIONS 
SEC. 112. Subsection (i) of section 11 of the Federal Home Loan 
Bank Act, as amended (12 U.S.C. 1431 (i)), is amended as follows: 
(1) In the fourth sentence of the first paragraph, strike out 
"subsection" both places it appears and insert in lieu thereof 
"paragraph". 
(2) Strike out the second paragraph and insert in lieu thereof 
the following: 
"In addition to obligations authorized to be purchased by the 
preceding paragraph, the Secretary of the Treasury is authorized to 
purchase any obligations issued pursuant to this section in amounts 
not to exceed $2,000,000,000. The authority provided in this paragraph 
shall expire August 10,1975. 
"Notwithstanding the foregoing, the authority provided in this 
subsection may be exercised during any calendar quarter beginning 
after the date of enactment of the Depository Institutions Amend-
ments of 1974 only if the Secretary of the Treasury and the Chairman 
of the Federal Home Loan Bank Board certify to the Congress that 
(1) alternative means cannot be effectively employed to permit mem-
bers of the Home I^oan Bank System to continue to supply reasonable 
amounts of funds to the mortgage market, and (2) the ability to sup-
ply such funds is substantially impaired because of monetary strin-
Repayment o
f 
geucy and a high level of interest rates. Any funds borrowed under this 
subsection shall be repaid by the Home Loan Banks at the earliest 
practicable date.". 
AUTHORITY 
OF 
T H E 
FEDERAL 
HOME 
LOAN 
MORTGAGE 
CORPORATION 
TO PURCHASE MORTGAGES FROM STATE INSURED INSTITUTIONS 
SEC. 113. The first sentence of section 305(a)(1) of the Federal 
1
2 use 1454. 
Home Loan Mortgage Corporation Act is amended by inserting "or 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1507 
from any financial institution the deposits or accounts of which are 
insured under the laws of any State if the total amount of time and 
savings deposits held in all such institutions in that State is more than 
20 per centum of the total amount of such deposits in all banks, build-
ing and loan, savings and loan, and homestead associations (including 
cooperative banks) in that State" immediately after "agency of the 
United States". 
TECHNICAL 
AMENDMENT 
SEC. 114. (a) Section 7(d) (2) of the Act of August 16,1973 (Public 
Law 93-100), is amended by striking out "the Commonwealth of 
Puerto Rico,". 
(b) The amendment made by subsection (a) applies with respect 
to any taxable year or other taxable period beginning on or after 
August 16,1973. 
12 u s e 548 
note. 
FEDERAL 
SAVINGS 
AND 
LOAN 
INSURANCE 
CORPORATION 
SECONDARY 
RESERVE 
ADJUSTMENT 
SEC. 115. Paragraph (1) of subsection (d) of section 404 of the 
National Housing Act, as amended (12 U.S.C. 1727), is amended by 
inserting " ( A ) " immediately after " ( d ) ( 1 ) " and by adding at the 
end thereof the following: 
"(B) (i) As used in this subparagraph (B), 'minimum net reduc-
tion year' means a year in which, at the close of December 31, the 
aggregate of the primary reserve and secondary reserve equals or 
exceeds 1 ^ per centum of the total amount of all accounts of insured 
members of all insured institutions, and 'beginning balance' means, 
with respect to each insured institution, the amount of such institu-
tion's pro rata share, if any, of the secondary reserve as of the close 
of December 31, 1973, plus any amount or amounts which, after such 
close, shall have been transferred to such institution under the last 
sentence of subsection (e) of this section. 
" (ii) In May of each year succeeding each of the first ten minimum 
net reduction years occurring after December 31,1973, the Corporation 
shall reduce the amount of each insured institution's pro rata share, if 
any, of the secondary reserve as of the preceding December 31 by 
making to the extent available, a cash refund to each such institution 
of the difference, if any, between such pro rata share and the applicable 
percentage of its beginning balance prescribed in the following table: 
Percent of begln-
"Minimum net reduction year: 
ning balance 
1 
98.1818182 
2 
94. 5454546 
3 
89. 0909091 
4 
81. 8181818 
5 
72. 7272727 
6 
61. 8181818 
7 
49. 0909091 
8 
34. 5454546 
9 
18.1818182 
10 
0. 0000000". 
"Minimum i 
reduction yet 
"Beginning 
balance." 
CREDIT U N I O N M A N A G E M E N T : REASONABLE H E A L T H AND ACCIDENT 
INSURANCE NOT CONSIDERED 
COMPENSATION 
SEC. 116. Section H I , of the Federal Credit Union Act (12 U.S.C. 
1761) is amended by striking the period at the end thereof and adding 
": Provided^ however^ That reasonable health, accident, and similar 
insurance protection shall not be considered compensation under regu-
lations promulgated by the Administrator.". 
1508 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
TITLE II—NATIONAL COMMISSION ON ELECTRONIC 
FUND TRANSFERS 
ESTABLISHMENT 
1
2 use 2401. 
gpj(.^ 201. There is established the National Commission on Elec-
tronic Fund Transfers (hereinafter referred to as the "Commission") 
which shall be an independent instrumentality of the United States. 
MEMBERSHIP 
12 use 2402. 
g^^^ ^202, (a) The Commission shall be composed of twenty-six 
members as follows: 
(1) the Chairman of the Board of Governors of the Federal 
Reserve System or his delegate; 
(2) the Attorney General or his delegate; 
(3) the Comptroller of the Currency or his delegate; 
(4) the Chairman of the Federal Home Loan Bank Board or 
his delegate; 
(5) the Administrator of the National Credit Union Adminis-
tration or his delegate; 
(6) the Chairman of the Board of Directors of the Federal 
Deposit Insurance Corporation or his delegate; 
(7) the Chairman of the Federal Communications Commis-
sion or his delegate; 
(8) the Postmaster General or his delegate; 
(9) the Secretary of the Treasury or his delegate; 
(10) the Chairman of the Federal Trade Commission or his 
delegate; 
(11) two individuals, appointed by the President, one of whom 
is an official of a State agency which regulates banking, or simi-
lar financial institutions, and one of whom is an official of a State 
agency which regulates thrift or similar financial institutions; 
(12) seven individuals, appointed by the President, who are 
officers or employees of, or who otherwise represent banking, 
thrift, or other business entities, including one representative 
each of commercial banks, mutual savings banks, savings and 
loan associations, credit unions, retailers, nonbanking institutions 
offering credit card services, and organizations providing inter-
change services for credit cards issued by banks; 
(13) five individuals, appointed by the President, from private 
life who are not affiliated with, do not i-epresent and have no sub-
stantial interest in any banking, thrift, or other financial institu-
tion, including but not limited to credit unions, retailers, and 
insurance companies; 
(14) the Comptroller General of the United States or his 
delegate; and 
(15) the Director of the Office of Technology Assessment. 
(b) The Chairperson shall be designated by the President at the 
time of his appointment from among the members of the Commission 
and such selection shall be by and with the advice and consent of the 
Senate unless the appointee holds an office to which he was appointed 
by and with the advice and consent of the Senate. 
(c) A vacancy in the Commission shall be filled in the manner in 
which the original appointment was made. 
FUNCTIONS 
12'us'e 2403 
^^^* ^^^' (^) '^^^ Commission shall conduct a thorough study and 
investigation and recommend appropriate administrative action and 
STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1509 
legislation necessary in connection with tlie possible development of 
public or private electronic fund transfer systems, taking into account, 
among other things— 
(1) the need to preserve competition among the financial 
institutions and other business enterprises using such a system; 
(2) the need to promote competition among financial institu-
tions and to assure Government regulation and involvement or 
participation in a system competitive with the private sector be 
kept to a minimum; 
(3) the need to prevent unfair or discriminatory practices by 
any financial institution or business enterprise using or desiring 
to use such a system; 
(4) the need to afford maximum user and consumer conven-
ience ; 
(5) the need to afford maximum user and consumer rights to 
privacy and confidentiality ; 
(6) the impact of such a system on economic and monetary 
policy; 
(7) the implications of such a system on the availability of 
credit; 
(8) the implications of such a system expanding internationally 
and into other forms of electronic communications; and 
(9) the need to protect the legal rights of users and consumers. 
(b) The Commission shall make an interim report within one year 
of its findings and recommendations and at such other times as it 
deems advisable and shall transmit to the President and to the Con-
gress not later than two years after the date of enactment of this Act a 
final report of its findings and recommendations. Any such report shall 
include all hearing transcripts, staff studies, and other material used 
in preparation of the report. The interim and final reports shall be 
made available to the public upon transmittal. Sixty days after trans-
mission of its final report the Commission shall cease to exist. 
(c) The Commission shall not be required to obtain the clearance 
of any Federal agency prior to the transmittal of any interim or final 
report. 
POWERS OF COMMISSION 
SEC. 204. (a) The Commission may for the purpose of carrying out 
this Act hold such hearings, sit and act at such times and places, take 
such testimony, and receive such evidence, as the Commission may 
deem advisable. The Commission may administer oaths of affirmations 
to witnesses appearing before it. 
(b) When so authorized by the Commission, any member or agent 
of the Commission may take any action which the Commission is 
authorized to take by this section. 
(c) The Commission may secure directly from any department or 
agency of the United States information necessary to enable it to carry 
out this Act. Upon request of the Chairperson of the Commission, the 
head of such department or agency shall furnish such information to 
the Commission. 
(d) (1) The Commission shall have power to issue subpenas requir-
ing the attendance and testimony of witnesses and the production of 
any evidence that relates to any matter under investigation by the 
Commission. Such attendance of witnesses and the production of such 
evidence may be required from any place within the United States 
at any designated place of hearing within the United States. 
(2) If a person issued a subpena under paragraph (1) refuses to 
obey such subpena or is guilty of contumacy, any court of the United 
States within the judicial district within which the hearing is con« 
Interim report. 
Final report 
to President 
and Congress, 
Termination 
date. 
Hearings. 
12 u s e 2404. 
Subpenas. 
38-194 O - 76 - 13 Pt. 2 
1510 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
ducted or within the judicial district within which such person is 
found or resides or transacts business may (upon application by the 
Commission) order such person to appear before the Commission to 
produce evidence or to give testimony touching the matter under 
investigation. Any failure to obey such order of the court may be 
punished by such court as a contempt thereof. 
(3) The subpenas of the Commission shall be served in the manner 
provided for subpenas issued by a United States district court under 
the Federal Rules of Civil Procedure for the United States district 
courts. 
(4) All process of any court to which application may be made 
under this section may be served in the judicial district wherein the 
pereon required to be served resides or may be found. 
ADMIN ISTR 
ATION 
12 use 2405. 
5 use 101 et 
seq. 
5 u s e 5101, 
5331. 
5 use 5332 
note. 
Experts and 
consultants. 
Audits, report 
to eongress. 
SEC. 205, (a) The Commission— 
(1) may appoint with the advice and consent of the Senate 
and fix the compensation of an Executive Director, and such 
additional staff pereonnel as he deems necessary, without regard 
to the provisions of title 5, United States Code, governing appoint-
ments in the competitive service, and without regard to cJiapter 
51 and subchapter I I I of chapter 53 of such title relating to 
classification and General Schedule pay rates, but at rates not 
in excess of the maximum rate for GS-18 of the General Schedule 
under section 5332 of such title; and 
(2) may procure temporary and intermittent services to the 
same extent as is authorized by section 3109 of title 5, United 
States Code, but at rates not to exceed $150 a day for individuals. 
(b) The Comptroller General is authorized to make detailed audits 
of the books and records of the Commission, and shall report the results 
of any such audit to the Commission and to the Congress. 
12 use 2406. 
COMPENSATION 
SEC. 206. (a) A member of the Commission who is an officer or 
employee of the United States shall serve as a member of the Com-
mission without additional compensation, but shall be entitled to 
reimbursement for travel, subsistence, and other necessary expenses 
incurred in the performance of his duties as a member of the 
Commission. 
(b) A member of the Commission who is not otherwise an officer 
or employee of the United States shall be compensated at a rate of 
$150 per day when engaged in the performance of his duties as a 
member of the (commission, and shall also be reimbursed for travel, 
subsistence, and other necessary expenses incurred in the performance 
of his duties as a member of the Commission. 
12 use 2407. 
ASSISTANCE OF GOVERNMENT AGENCIES 
SEC. 207. (a) Each department, agency, and instrumentality of the 
executive branch of the Government, including independent agen-
cies, is authorized and directed to furnish to the Commission, upon 
request, such data, reports, and other information as the Commission 
deems necessary to carry out its functions under this title. 
(b) The head of any department, agency, or instrumentality of the 
United States may detail such personnel and may furnish such services, 
with or without reimbursement, as the Commission may request to 
assist it in carrying out its functions. 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1511 
AUTHORIZATION OF APPROPRIATIONS 
SEC. 208. There are authorized to be appropriated without 
fiscal 
1
2 use 24os. 
year limitations such sums, not to exceed $2,000,000, as may be neces-
sary to carry out the provisions of this title. 
TITLE III—FAIR CREDIT BILLING 
^-'^ c;-'^" 
Billing Act. 
§ 301. Short title 
This title may be cited as the "Fair Credit Billing Act". 
J^l use leoi 
§ 302. Declaration of purpose 
The last sentence of section 102 of the Truth in Lending Act (15 
U.S.C. 1601) is amended by striking out the period and inserting in 
lieu thereof a comma and the following: "and to protect the consumer 
against inaccurate and unfair credit billing and credit card practices." 
§ 303. Definitions of creditor and open end credit plan 
The first sentence of section 103(f) of the Truth in Lending Act 
(15 U.S.C. 1602(f)) is amended to read as follows: "The term 'credi-
tor' refers only to creditors who regularly extend, or arrange for the 
i 
extension of, credit which is payable by agreement in more than four 
installments or for which the payment of a finance charge is or may 
be required, whether in connection with loans, sales of property or 
services, or otherwise. For the purposes of the requirements imposed 
under Chapter 4 and sections 127(a) (6), 127(a) (7), 127(a) (8), 127 
(b)(1), 127(b) (2), 127(b) (3), 127(b) (9), and 127(b) (11) of Chapter 
2 of this Title, the term 'creditor' shall also include card issuers whether 
^°^j' P- ^ ^ ^ ^ • 
or not the amount due is payable by agreement in more than four 
1
5 use 1637, 
installments or the payment of a finance charge is or may be required, 
and the Board shall, by regulation, apply these requirements to such 
card issuers, to the extent appropriate, even though the requirements 
are by their terms applicable only to creditors offering open end 
credit plans. 
§ 304. Disclosure of fair credit billing rights 
(a) Section 127(a) of the Truth in landing Act (15 U.S.C. 1637 
(a)) is amended by adding at the end thereof a new paragraph as 
follows: 
"(8) A statement, in a form prescribed by regulations of the 
Board of the protection provided by sections 161 and 170 to an 
Post, pp. 1512, 
obligor and the creditor's responsibilities under sections 162 and ^^^^' 
170. With respect to each of two billing cycles per year, at semi-
annual intervals, the creditor shall transmit such statement to each 
obligor to whom the creditor is required to transmit a statement 
pursuant to section 127(b) for such billing cycle." 
(b) Section 127(c) of such Act (15 U.S.C. 1637(c)) is amended to 
read: 
"(c) In the case of any existing account under an open end con-
sumer credit plan having an outstanding balance of more than $1 at 
or after the close of the creditor's first full billing cycle under the plan 
after the effective date of subsection (a) or any amendments thereto, 
the items described in subsection (a), to the extent applicable and not 
previously disclosed, shall be disclosed in a notice mailed or delivered 
to the obligor not later than the time of mailing the next statement 
required by subsection (b)." 
§ 305. Disclosure of billing contact 
Section 127(b) of the Truth in Lending Act (16 U.S.C. 1637(b)) is 
amended by adding at the end thereof a new paragraph as follows: 
Ante, p. 1511. 
1512 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
"(11) The address to be used by the creditor for the purpose 
of receiving billin<>j inquiries from the obligor." 
§ 306. Billing practices 
The Truth in Lending Act (15 U.S.C. 1601-1665) is amended by 
adding at the end thereof a new chapter as follows: 
"Chapter 4—CREDIT BILLING 
"Sec. 
"161. Correction of billing errors. 
"162. Regulation of credit reports. 
"163. Length of billing period. 
"164. Prompt crediting of payments. 
"165. Crediting excess payments. 
"166. Prompt notification of returns. 
"167. Use of cash discounts. 
"168. Prohibition of tie-in services. 
"169. Prohibition of offsets. 
"170. Rights of credit card customers. 
"171. Relation to State laws, 
"§ 161. Correction of billing errors 
15 use 1666. 
"(a) If a creditor, within sixty days after having transmitted to an 
obligor a statement of the obligor's account in connection with an 
extension of consumer credit, receives at the address disclosed under 
Ante, p. 1511. 
sectiou 127(b) (11) a written notice (other than notice on a payment 
stub or other payment medium supplied by the creditor if the creditor 
so stipulates with the disclosure required under section 127(a)(8)) 
from the obligor in which the obligor— 
"(1) sets forth or otherwise enables the creditor to identify the 
name and account number (if any) of the obligor, 
"(2) indicates the obligor's belief that the statement contains 
a billing error and the amount of such billing error, and 
"(3) sets forth the reasons for the obligor's belief (to the 
extent applicable) that the statement contains a billing error, 
the creditor shall, unless the obligor has, after giving such written 
notice and before the expiration of the time limits herein specified, 
agreed that the statement was correct— 
" (A) not later than thirty days after the receipt of the notice, 
send a written acknowledgement thereof to the obligor, unless the 
action required in subparagraph (B) is taken within such thirty-
day period, and 
"(B) not later than two complete billing cycles of the creditor 
(in no event later than ninety days) after the receipt of the notice 
and prior to taking any action to collect the amount, or anv part 
thereof, indicated by the obligor under paragraph (2) either— 
"(i) make appropriate corrections in the account of the 
obligor, including the crediting of any finance charges on 
amounts erroneously billed, and transmit to the obligor a 
notification of such corrections and the creditor's explanation 
of any change in the amount indicated by the obligor under 
paragraph (2) and, if any such change is made and the 
obligor so requests, copies of documentary evidence of the 
obligor's indebtedness; or 
"(ii) send a written explanation or clarification to the 
obligor, after having conducted an investigation, setting 
forth to the extent applicable the reasons why the creditor 
believes the account of the obligor was correctly shown in 
the statement and. upon request of the obligor, provide copies 
of documentary evidence of the obligor's indebtedness. In 
the case of a billing error where the obligor alleges that the 
creditor's billing statement reflects goods not delivered to 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1513 
the obligor or his designee in accordance with the agreement 
made at the time of the transaction, a creditor may not con-
strue such amount to be correctly shown unless he determines 
that such goods were actually delivered, mailed, or otherwise 
sent to the obligor and i)rovides the obligor with a statement 
of such determination. 
After complying with the provisions of this subsection with respect 
to an alleged billing error, a creditor has no further responsibility 
under this section if the obligor continues to make substantially the 
same allegation with respect to such error. 
" (b) For the purpose of this section, a 'billing error' consists of any 
Definitions. 
of the following: 
" (1) A reflection on a statement of an extension of credit which 
was not made to the obligor or, if made, was not in the amount 
reflected on such statement. 
"(2) A reflection on a statement of an extension of credit for 
which the obligor requests additional clarification including docu-
mentary evidence thereof. 
"(3) A reflection on a statement of goods or services not 
accepted by the obligor or his designee or not delivered to the 
obligor or his designee in accordance with the agreement made 
at the time of a transaction. 
"(4) The creditor's failure to reflect properly on a statement 
a payment made by the obligor or a credit issued to the obligor. 
"(5) A computation error or similiar error of an accounting 
nature of the creditor on a statement. 
" (6) Any other error described in regulations of the Board. 
"(c) For the purposes of this section, 'action to collect the amount, 
or any part thereof, indicated by an obligor under paragraph (2)' 
does not include the sending of statements of account to the obligor 
following written notice from the obligor as specified under sub-
section (a), if— 
"(1) the obligor's account is not restricted or closed because of 
the failure of the obligor to pay the amount indicated under 
paragraph (2) of subsection (a),and 
"(2) the creditor indicates the payment of such amount is 
not required pending the creditor's compliance with this section. 
Nothing in this section shall be construed to prohibit any action by 
a creditor to collect any amount which has not been indicated by the 
obligor to contain a billing error. 
"(d) Pursuant to regulations of the Board, a creditor operating an 
open end consumer credit plan may not, prior to the sending of the 
written explanation or clarification required under paragraph (B) 
(ii), restrict or close an account with respect to which the obligor has 
indicated pursuant to subsection (a) that he believes such account to 
contain a billing error solely because of the obligor's failure to pay 
the amount indicated to be in error. Nothing in this subsection shall 
be deemed to prohibit a creditor from applying against the credit 
limit on the obliefor's account the amount indicated to be in error. 
"(e) Any creditor who fails to comply with the requirements of this 
Noncompliance. 
section or section 162 forfeits any right to collect from the obligor 
the amount indicated by the obligor under paragraph (2) of sub-
section (a) of this section, and any finance charges thereon, except 
that the amount required to be forfeited under this subsection may 
not exceed $50. 
*'§ 162. Regulation of credit reports 
"(a) After receiving a notice from an obligor as provided in section 
^^ ^^^ ^^^^^• 
161(a), a creditor or his agent may not directly or indirectly threaten 
1514 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
to report to any person adversely on the obligor's credit rating or 
credit standing because of the obligor's failure to pay the amount 
indicated by the obligor under section 161(a) (2), and such amount 
may not be reported as delinquent to any third party until the creditor 
has met the requirements of section 161 and has allowed the obligor 
the same number of days (not less than ten) thereafter to make 
payment as is provided under the credit agreement with the obligor 
for the payment of undisputed amounts. 
"(b) If a creditor receives a further written notice from an obligor 
that an amount is still in dispute within the time allowed for payment 
under subsection (a) of this section, a creditor may not report to any 
third party that the amount of the obligor is delinquent because the 
obligor has failed to pay an amount which he has indicated under 
section 161(a) (2), unless the creditor also reports that the amount 
is in dispute and, at the same time, notifies the obligor of the name 
and address of each party to whom the creditor is reporting informa-
tion concerning the delinquency. 
"(c) A creditor shall report any subsequent resolution of any delin-
quencies reported pursuant to subsection (b) to the parties to whom 
such delinquencies were initially reported. 
"§ 163. Length of billing period 
15 use 1666b. 
"(a) If an open end consumer credit plan provides a time period 
within which an obligor may repay any portion of the credit extended 
without incurring an additional finance charge, such additional 
finance charge may not be imposed with respect to such portion of the 
credit extended for the billing cycle of which such period is a part 
unless a statement which includes the amount upon which the finance 
charge for that period is based was mailed at least fourteen days 
prior to the date specified in the statement by which payment must 
be made in order to avoid imposition of that finance charge. 
"(b) Subsection (a) does not apply in any case where a creditor 
has been prevented, delayed, or hindered in making timely mailing or 
delivery of such periodic statement within the time period specified 
in such subsection because of an act of God, war, natural disaster, 
strike, or other excusable or justifiable cause, as determined under reg-
ulations of the Board. 
"§ 164. Prompt crediting of payments 
1
5 use 1666c, 
"Payments received from an obligor under an open end consumer 
credit plan by the creditor shall be posted promptly to the obligor's 
account as specified in regulations of the Board. Such regulations shall 
prevent a finance charge from being imposed on any obligor if the 
creditor has received the obligor's payment in readily identifiable form 
in the amount, manner, location, and time indicated by the creditor 
to avoid the imposition thereof. 
"§ 165. Crediting excess payments 
"Whenever an obligor transmits funds to a creditor in excess of the 
total balance due on an open end consumer credit account, the creditor 
shall promptly (1) upon request of the obligor refund the amount of 
the overpayment, or (2) credit such amount to the obligor's account. 
*
*
§ 166. Prompt notification of returns 
15 use i666e. 
"With rcspcct to any sales transaction where a credit card has been 
used to obtain credit, where the seller is a person other than the card 
issuer, and where the seller accepts or allows a return of the goods 
or forgiveness of a debit for services which were the subject of such 
sale, the seller shall promptly transmit to the credit card issuer, a 
credit statement with respect thereto and the credit card issuer shall 
credit the account of the obligor for the amount of the transaction. 
15 use 1666d. 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1515 
"§ 167. Use of cash discounts 
"(a) With respect to credit card which may be used for extensions 
of credit in sales transactions in which the seller is a person other than 
the card issuer, the card issuer may not, by contract or otherwise, 
prohibit any such seller from offering a discount to a cardholder to 
induce the cardholder to pay by cash, check, or similar means rather 
than use a credit card. 
"(b) With respect to any sales transaction, any discount not in excess 
of 5 per centum offered by the seller for the purpose of inducing pay-
ment by cash, check, or other means not involving the use of a credit 
card shall not constitute a finance charge as determined under section 
106, if such discount is offered to all prospective buyers and its avail-
ability is disclosed to all prospective buyers clearl}^ and conspicuously 
in accordance with regulations of the Board. 
"§ 168. Prohibition of tie-in services 
"Notwithstanding any agreement to the contrary, a card issuer may 
not require a seller, as a condition to participating in a credit card plan, 
to open an account with or procure any other service from the card 
issuer or its subsidiary or agent. 
"§ 169. Prohibition of offsets 
"(a) A card issuer may not take any action to offset a cardholder's 
indebtedness arising in connection with a consumer credit transaction 
under the relevant credit card plan against funds of the cardholder 
held on deposit with the card issuer unless— 
"(1) such action was previously authorized in writing by the 
cardholder in accordance with a credit plan whereby the card-
holder agrees periodically to pay debts incurred in his open end 
credit account by permitting the card issuer periodically to deduct 
all or a portion of such debt from the cardholder's deposit account, 
and 
"(2) such action with respect to any outstanding disputed 
amount not be taken by the card issuer upon request of the card-
holder. 
In the case of any credit card account in existence on the effective date 
of this section, the previous written authorization referred to in clause 
(1) shall not be required until the date (after such effective date) when 
such account is renewed, but in no case later than one year after such 
effective date. Such written authorization shall be deemed to exist if 
the card issuer has previously notified the cardholder that the use of 
his credit card account will subject any funds which the card issuer 
holds in deposit accounts of such cardholder to offset against any 
amounts due and payable on his credit card account which have not 
been paid in accordance with the terms of the agreement between the 
card issuer and the cardholder. 
"(b) This section does not alter or affect the right under State law 
of a card issuer to attach or otherwise levy upon funds of a cardholder 
held on deposit with the card issuer if that remedy is constitutionally 
available to creditore generally. 
"§ 170. Rights of credit card customers 
"(a) Subject to the limitation contained in subsection (b), a card 
issuer who has issued a credit card to a cardholder pursuant to an 
open end consumer credit plan shall be subject to all claims (other 
than tort claims) and defenses arising out of any transaction in which 
the credit card is used as a method of payment or extension of credit 
if (1) the obligor has made a good faith attempt to obtain satisfactory 
resolution of a disagreement or problem relative to the transaction 
from the person honoring the credit card; (2) the amount of the initial 
1
5 
use 
1666f. 
1
5 
use 
1666g. 
1
5 
use 
1666h. 
1
5 use 
16661 
1516 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
transaction exceeds $50; and (3) the place where the initial transaction 
occurred was in the same State as the mailing address previously pro-
vided by the cardholder or was within 100 miles from such address, 
except that the limitations set forth in clauses (2) and (3) with 
respect to an obligor's right to assert claims and defenses against a 
card issuer shall not be applicable to any transaction in which the 
person honoring the credit card (A) is the same person as the card 
issuer, (B) is controlled by the card issuer, (C) is under direct or 
indirect common control with the card issuer, (D) is a franchised 
dealer in the card issuer's products or services, or (E) has obtained 
the order for such transaction through a mail solicitation made by or 
participated in by the card issuer in which the cardholder is solicited 
to enter into such transaction by using the credit card issued by the 
card issuer. 
"(b) The amount of claims or defenses asserted by the cardholder 
may not exceed the amount of credit outstanding with respect to such 
transaction at the time the cardholder first notifies the card issuer or 
the person honoring the credit card of such claim or defense. For the 
purpose of deterrriining the amount of credit outstanding in the 
preceding sentence, payments and credits to the cardholder's account 
are deemed to have been applied, in the order indicated, to the payment 
of: (1) late charges in the order of their entry to the account; (2) 
finance charges in order of their entry to the account; and (3) debits 
to the account other than those set forth above, in the order in which 
each debit entry to the account was made. 
"§ 171. Relation to State laws 
15 use 1666J. 
"(a) This chapter does not annul, alter, or affect, or exempt any 
person subject to the provisions of this chapter from complying with, 
the laws of any State with respect to credit billing practices, except to 
the extent that those laws are inconsistent with any provision of this 
chapter, and then only to the extent of the inconsistency. The Board is 
authorized to determine whether such inconsistencies exist. The Board 
ma^ not determine that any State law is inconsistent with any pro-
vision of this chapter if the Board determines that such law gives 
greater protection to the consumer. 
"(b) The Board shall by regulation exempt from the requirements 
of this chapter any class of credit transactions within any State if it 
determines that under the law of that State that class of transactions 
is subject to requirements substantially similar to those imposed under 
this chapter or that such law gives greater protection to the consumer, 
and that there is adequate provision for enforcement." 
§ 307. Conforming amendments 
(a) The table of chapters of the Truth in Lending Act is amended 
by adding immediately under item 3 the following: 
"4. CREDIT BIIXING 
161" 
(b) Section 111(d) of such Act (15 U.S.C 1610(d)) is amended by 
striking out "and 130" and inserting in lieu thereof a comma and the 
following: "130, and 166". 
(c) Section 121(a) of such Act (15 U.S.C. 1631(a)) is amended— 
(1) by striking out "and upon whom a finance charge is or may 
be imposed"; and 
(2) by inserting "or chapter 4" immediately after 
"this 
chapter". 
(d) Section 121 (b) of such Act (15 U.S.C. 1631 (b)) is amended by 
inserting "or chapter 4" immediately after "this chapter". 
(e) Section 122(a) of such Act (15 U.S.C. 1632(a)) is amended by 
inserting "or chapter 4" immediately after "this chapter". 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1517 
(f) Section 122(b) of such Act (15 U.S.C 1632(b)) is amended 
by inserting "or chapter 4" immediately after "this chapter". 
§ 308. Effective date 
This title takes effect upon the expiration of one year after the date 
is use leee 
of its enactment. 
TITLE IV—AMENDMENTS TO T H E TRUTH IN LENDING 
ACT 
§401. Advertising; more-than-four-installment rule 
(a) Chapter 3 of the Truth in Lending Act (15 U.S.C. 1661-1665) 
is amended by adding at the end thereof a new section as follows: 
*'§ 146. More-than-four-installment rule 
"Any advertisement to aid, promote, or assist directly or indirectly 
^^ use leesa. 
the extension of consumer credit repayable in more than four install-
ments shall, unless a finance charge is imposed, clearly and conspicu-
ously state, in accordance with the regulations of the Board: 
" ' T H E COST OF CREDIT IS INCLUDED IN T H E 
PRICE QUOTED FOR T H E GOODS AND SERVICES.' " 
(h) The table of sections of such chapter is amended by adding 
at the end thereof a new item as follows: 
"146. More-than-four-installment rule.". 
§ 402. Agricultural credit exemption 
Section 104 of the Truth in Lending Act (15 U.S.C. 1603) is 
amended by adding at the end thereof a new paragraph as follows: 
"(5) Credit transactions primarily for agricultural purposes 
in which the total amount to be financed exceeds $25,000." 
u -
^ f 
§ 403. Administrative enforcement 
(a) Section 108(a) of the Truth in Lending Act (15 U.S.C. 1607 
(a)) is amended by striking out paragraph (4) and by redesignating 
paragraphs (5) and (6) as paragraphs (4) and (5), respectively. 
(b) Section 108(a) of such Act (15 U.S.C. 1607(a)) is amended 
by adding at the end thereof a new paragraph as follows: 
"(6) the Farm Credit Act of 1971, by the Farm Credit Ad- _\l use 2001 
ministration with respect to any Federal land bank, Federal land "" ° 
bank association, Federal intermediate credit bank, or produc-
tion credit association." 
§ 404. Liens arising by operation of State law 
Section 125 of the Truth in Lending Act (15 U.S.C. 1635) is 
amended— 
(1) by striking out "is" the first time it appears in the first 
sentence of subsection (a) and inserting in lieu thereof ", includ-
ing any such interest arising by operation of law, is or will be"; 
and 
(2) by inserting after "obligor" the second time it appears in 
the first sentence of subsection (b) the following: ", including any 
such interest arising by operation of law,". 
§ 405. Time limit for right of rescission 
Section 125 of the Truth in Lending Act (15 U.S.C. 1635) is 
amended by adding at the end thereof a new subsection as follows: 
"(f) An obligor's right of rescission shall expire three years after 
the date of consummation of the transaction or upon the sale of the 
property, whichever occurs earlier, notwithstanding the fact that the 
disclosures required under this section or any other material dis-
note. 
1518 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
closures required under this chapter have not been delivered to the 
obligor." 
§ 406. Good faith compliance 
Section 130 of the Truth in Lending Act (15 U.S.C. 1640) is 
amended by adding at the end thereof a new subsection as follows: 
"(f) No provision of this section or section 112 imposing any liabil-
ity shall apply to any act done or omitted in good faith in conformity 
with any rule, regulation, or interpretation thereof by the Board, not-
withstanding that after such act or omission has occurred, such rule, 
regulation, or interpretation is amended, rescinded, or determined by 
judicial or other authority to be invalid for any reason." 
§ 407. Liability for multiple disclosures 
Section 130 of the Truth in Lending Act (15 U.S.C. 1640) is amended 
by adding at the end thereof a new subsection as follows: 
"(g) The multiple failure to disclose to any person any information 
required under this chapter to l)e disclosed in connection with a single 
account under an open end consumer credit plan, other single con-
sumer credit sale, consumer loan, or other extension of consumer credit, 
shall entitle the person to a single recovery under this section but 
continued failure to disclose after a recovery has been granted shall 
give rise to rights to additional recoveries." 
§ 408. Civil liability 
(a) Section 130(a) of the Truth in landing Act (15 U.S.C. 1640(a)) 
is amended to read as follows: 
"(a) Except as otherwise provided in this section, any creditor 
who fails to comply with any requirement imposed under this chapter 
Ante, p, 1512, 
or chaptcr 4 of this title with respect to any person is liable to such 
person in an amount equal to the sum of— 
"(1) any actual damage sustained by such person as a result of 
the failure; 
"(2) (A) in the case of an individual action twice the amount 
of any finance charge in connection with the transaction, except 
that the liability under this subparagraph shall not be less than 
$100 nor greater than $1,000; or 
"(B) in the case of a class action, such amount as the court 
may allow, except that as to each member of the class no minimum 
recovery shall be applicable, and the total recovery in such action 
shall not be more than the lesser of $100,000 or 1 per centum of 
the net worth of the creditor; and 
"(3) in the case of any successful action to enforce the fore-
going liability, the costs of the action, together with a reasonable 
attorney's fee as determined by the court. 
In determining the amount of award in any class action, the court 
shall consider, among other relevant factors, the amount of any actual 
damages awarded, the frequency and persistence of failures of com-
pliance by the creditor, the resources of the creditor, the number of 
persons adversely affected, and the extent to which the creditor's failure 
of compliance was intentional." 
(b) Section 130(b) of such Act (15 U.S.C. 1640(b)) is amended by 
inserting after "this section" the first place it appears the following: 
"for any failure to comply with any requirement imposed under this 
chapter,". 
(c) Section 130(c) of such Act (15 U.S.C. 1640(c)) is amended by 
striking out "chapter" and inserting in lieu thereof "title". 
(d) Section 130 of such Act (15 U.S.C. 1640) is amended by adding 
at the end thereof a new subsection as follows: 
"(h) A person may not take any action to offset any amount for 
which a creditor is potentially liable to such person under subsection 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
15:L9 
(a) (2) against any amount owing to such creditor by such person, 
unless the amount of the creditor's liability to such person has been 
determined by judgment of a court of competent jurisdiction in an 
action to which such person was a party." 
(e) The amendments made by sections 406, 407, and 408 shall apply ^J^^ use i64o 
in determining the liability of any person under chapter 2 or 4 of the 
Truth in Lending Act, unless prior to the date of enactment of this 
Act such liability has been determined by final judgment of a court 
of competent jurisdiction and no further review of such judgment 
may be had by appeal or otherwise. 
§ 409. Full statement of closing costs 
Section 121 of the Truth in Lending Act (15 U.S.C. 1631) is 
, 
amended by adding at the end thereof a new subsection as follows: 
"(c) For the purpose of subsection (a), the information required 
under this chapter shall include a full statement of closing costs to be 
incurred by the consumer, which shall be presented, in accordance 
with the regulations of the Board— 
"(1) prior to the time when any downpayment is made, or 
"(2) m the case of a consumer credit transaction involving real 
property, at the time the creditor makes a commitment with 
respect to the transaction. 
The Board may provide by regulation that any portion of the informa-
tion required to be disclosed by this section may be given in the form 
of estimates where the provider of such information is not in a posi-
tion to know exact information." 
§ 410. Business use of credit cards 
] 
(a) Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631-1644) 
is amended by adding the following new section at the end thereof: 
*
*
§ 135. Business credit cards 
"The exemption provided by section 104(1) does not apply to the 
provisions of sections 132, 133, and 134, except that a card issuer and 
^^ use i642, 
a busmess or other organization which provides credit cards issued 
by the same card issuer to ten or more of its employees may by contract 
agree as to liability of the business or other organization with respect 
to unauthorized use of such credit cards without regard to the provi-
sions of section 133, but in no case may such business or other organi-
zation or card issuer impose liability upon any employee with respect 
to unauthorized use of such a credit card except in accordance with and 
subject to the limitations of section 133." 
(b) The table of sections of such chapter is amended by adding at 
the end thereof a new item as follows: 
"135. Business credit cards.". 
§ 411. Identification of transaction 
Section 127(b) (2) of the Truth in Lending Act (15 U.S.C. 1637 
(b) (2)) is amended to read as follows: 
"(2) The amount and date of each extension of credit during the 
period and a brief identification on or accompanying the statement of 
each extension of credit in a form prescribed by regulations of the 
Board sufficient to enable the obligor to identify the transaction, or 
relate it to copies of sales vouchers or similar instruments previously 
furnished." 
§412. Exemption for State lending agencies 
Section 125(e) of the Truth in Lending Act (15 U.S.C. 1635(e)) is 
amended by striking the period at the end thereof and adding the 
following: "or to a consumer credit transaction in which an agency of 
a State is the creditor." 
15 
use 1645. 
1643, 1644. 
1520 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
§ 413. Liability of assignees 
(a) Chapter 1 of the Truth in Lending Act (15 U.S.C. 1601-1613) 
is amended by adding at the end thereof a new section as follows: 
"§ 115. Liability of assignees 
1
5 use 1614. 
"Except as otherwise specifically provided in this title, any civil 
action for a violation of this title which may be brought against the 
original creditor in any credit transaction may be maintained against 
any subsequent assignee of the original creditor where the violation 
from which the alleged liability arose is apparent on the face of the 
instrument assigned unless the assignment is involuntary." 
(b) The analysis of such chapter is amended by adding at the end 
thereof a new item as follows: 
"115. Liability of assignees.". 
§ 414. Credit card fraud 
Section 134 of the Truth in Lending Act (15 U.S.C. 1644) is amended 
to read as follows: 
"§ 134. Fraudulent use of credit card 
"(a) Whoever knowingly in a transaction affecting interstate or 
foreign commerce, uses or attempts or conspires to use any counter-
feit, fictitious, altered, forged, lost, stolen, or fraudulently obtained 
credit card to obtain money, goods, services, or anything else of value 
which within any one-year period has a value aggregating $1,000 or 
more; or 
"(b) Whoever, with unlawful or fraudulent intent, transports or 
attempts or conspires to transport in interstate or foreign commerce a 
counterfeit, fictitious, altered, forged, lost, stolen, or fraudulently 
obtained credit card knowing the same to be counterfeit, fictitious, 
altered, forged, lost, stolen, or fraudulently obtained; or 
"(c) Whoever, with unlawful or fraudulent intent, uses any instru-
mentality of interstate or foreign commerce to sell or transport a 
counterfeit, fictitious, altered, forged, lost, stolen, or fraudulently 
obtained credit card knowing the same to be counterfeit, 
fictitious, 
altered, forged, lost, stolen, or fraudulently obtained; or 
"(d) Whoever knowingly receives, conceals, uses, or transport 
money, goods, services, or anything else of value (except tickets for 
interstate or foreign transportation) which (1) within any one-year 
period has a value aggregating $1,000 or more, (2) has moved in or is 
part of, or which constitutes interstate or foreign coromerce, and (3) 
has been obtained with a counterfeit, fictitious, altered, forged, lost, 
stolen, or fraudulently obtained credit card; or 
"(e) Whoever knowingly receives, conceals, uses, sells, or transports 
in interstate or foreign commerce one or more tickets for interstate or 
foreign transportation, which (1) within any one-year period have 
a value aggregating $500 or more, and (2) have been purchased or 
obtained with one or more counterfeit, fictitious, altered, forged, lost, 
stolen, or fraudulently obtained credit cards; or 
"(f) Whoever in a transaction affecting interstate or foreign com-
merce furnishes money, property, services, or anything else of value, 
which within any one-year period has a value aggregating $1,000 or 
more, through the use of any counterfeit, fictitious, altered, forged, 
lost, stolen, or fraudulently obtained credit card knowing the same to 
be counterfeit, fictitious, altered, forged, lost, stolen, or fraudulently 
obtained— 
Penalty. 
shall be fined not more than $10,000 or imprisoned not more than ten 
year-s, or both." 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1521 
§ 415. Grace period for consumers 
Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is 
amended— 
(1) by amending subsection (a)(1) to read as follows: 
"(1) The conditions under which a finance charge may be 
imposed, including the time period (if any) within which any 
credit extended may be repaid without incurring a finance charge, 
except that the creditor may, at his election and without dis-
closure, impose no such finance charge if payment is received after 
the termination of such time period."; and 
(2) by amending subsection (b) (10) to read as follows: 
"(10) The date by which or the period (if any) within which, 
payment must be made to avoid additional finance charges, except 
that the creditor may, at his election and without disclosure, 
impose no such additional finance charge if payment is received 
after such date or the termination of such period." 
§ 416. Effective date 
This title takes effect upon the date of its enactment, except that 
is use leesa 
sections 409 and 411 take effect upon the expiration of one year after 
the date of its enactment. 
TITLE V—EQUAL CREDIT OPPORTUNITY 
§ 501. Short title 
This title may be cited as the "Equal Credit Opportunity Act". 
^''"^i Credit 
•
^ 
^ 
1 X 
.7 
Opportunity Act. 
§ 502. Findings and purpose 
is use i69i 
The Congress finds that there is a need to insure that the various 
15 use i69i 
financial institutions and other firms engaged in the extensions of 
credit exercise their responsibility to make credit available with fair-
ness, impartiality, and without discrimination on the basis of sex or 
marital status. Economic stabilization would be enhanced and compe-
tition among the various financial institutions and other firms engaged 
in the extension of credit would be strengthened by an absence of dis-
crimination on the basis of sex or marital status, as well as by the 
informed use of credit which Congress has heretofore sought to 
promote. It is the purpose of this Act to require that financial institu-
tions and other firms engaged in the extension of credit make that credit 
equally available to all creditworthy customers without regard to sex 
or marital status. 
§ 503. Amendment to the Consumer Credit Protection Act 
The Consumer Credit Protection Act (Public Law 90-321), is „^\l^^^ ^^^^ 
amended by adding at the end thereof a new title V I I : 
note. 
note. 
"TITLE VII—EQUAL CREDIT OPPORTUNITY 
"Sec. 
"701. Prohibited discrimination. 
"702. Definitions. 
"703. Regulations. 
"704. Administrative enforcement, 
"705. Relation to State laws. 
"706. Civil liability. 
"707. Effective date. 
"§ 701. Prohibited discrimination 
"(a) It shall be unlawful for any creditor to discriminate against 
any applicant on the basis of sex or marital status with respect to any 
aspect of a credit transaction. 
" (b) An inquiry of marital status shall not constitute discrimination 
for purposes of this title if such inquiry is for the purpose of ascer-
15 u s e 1691. 
1522 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
taining the creditor's rights and remedies applicable to the particular 
extension of credit, and not to discriminate in a determination of 
creditworthiness. 
"§702. Definitions 
IS use 1691a. 
"(a) The definitions and rules of construction set forth in this 
section are applicable for the purposes of this title. 
"(b) The term 'applicant' means any person who applies to a 
creditor directly for an extension, renewal, or continuation of credit, 
or applies to a creditor indirectly by use of an existing credit plan for 
an amount exceeding a previously established credit limit. 
"(c) The term 'Board' refers to the Board of Governors of the 
Federal Reserve System. 
"(d) The term 'credit' means the right granted by a creditor to a 
debtor to defer payment of debt or to incur debts and defer its payment 
or to purchase property or services and defer payment therefor. 
" (e) The term 'creditor' means any person who regularly extends, 
renews, or continues credit; any person who regularly arranges for 
the extension, renewal, or continuation of credit; or any assignee of an 
original creditor who participates in the decision to extend, renew, or 
continue credit. 
"(f) The term 'person' means a natural person, a corporation, 
government or governmental subdivision or agency, trust, estate, part-
nership, cooperative, or association. 
"(g) Any reference to any requirement imposed under this title or 
any provision thereof includes reference to the regulations of the 
Board under this title or the provision thereof in question. 
"§703. Regulations 
15 use 1691b. 
"The Board shall prescribe regulations to carry out the purposes of 
this title. These regulations may contain but are not limited to such 
classifications, differentiation, or other provision, and may provide 
for such adjustments and exceptions for any class of transactions, as 
in the judgment of the Board are necessary or proper to effectuate 
the purposes of this title, to prevent circumvention or evasion thereof, 
or to facilitate or substantiate compliance therewith. Such regulations 
shall be prescribed as soon as possible after the date of enactment of 
this Act, but in no event later than the effective date of this Act. 
"§ 704. Administrative enforcement 
IS use 1691c. 
"(a) Compliance with the requirements imposed under this title 
shall be enforced under: 
12 use 1818. 
"(1) Section 8 of the Federal Deposit Insurance Act, in the 
case of— 
"(A) national banks, by the Comptroller of the Currency, 
"(B) member banks of the Federal Reserve System (other 
than national banks), by the Board, 
"(C) banks insured by the Federal Deposit Insurance 
Corporation (other than members of the Federal Reserve 
System), by the Board of Directors of the Federal Deposit 
Insurance Corporation. 
12 use 1464. 
«(2) Section 5(d) of the Home Owners' Loan Act of 19.33, 
1
2 use 1730. 
section 407 of the National Housing Act, and sections 6(i) and 
143^7"^^ ^426, ^ 
17 of the Federal Honie Loan Bank Act, by the Federal Home 
Loan Bank Board (acting directly or through the Federal Sav-
ings and Loan Insurance Corporation), in the case of any insti-
tution subject to any of those provisions. 
12 use 1751. 
"(3) The Federal Credit Union Act, by the Administrator of 
the National Credit Union Administration with respect to any 
Federal Credit Union. 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1523 
"(4) The Acts to regulate commerce, by the Interstate Com-
merce Commission with respect to any common carrier subject to 
"(5) The Federal Aviation Act of 1958, by the Civil Aero- „t^ "^"^ ' ' ° ' 
l * - r » 
T
'
l 
• 
•
(
»
• 
• 
. n o t e . 
nautics Board with respect to any air carrier or foreign air carrier 
subject to that Act. 
"(6) The Packers and Stockyards Act, 1921 (except as provided ^J^^^'^ ^^^ 
in section 406 of that Act), by the Secretary of Agriculture with 
? use 226, 227. 
respect to any activities subject to that Act. 
" (7) The Farm Credit Act of 1971, by the Farm Credit Admin- 
1
2 use 2001 
istration with respect to any Federal land bank. Federal land "°*^' 
bank association, Federal intermediate credit bank, and produc-
tion credit association; 
"(8) The Securities Exchange Act of 1934, by the Securities 
^^ use 78a. 
and Exchange Commission with respect to brokers and dealers; 
and 
" (9) The Small Business Investment Act of 1958, by the_Small 
is use 661 
Business Administration, with respect to small business invest- "°*^" 
ment companies. 
"(b) For the purpose of the exercise by any agency referred to in 
subsection (a) of its powers under any Act referred to in that sub-
section, a violation of any requirement imposed under this title shall 
be deemed to be a violation of a requirement imposed under that Act. 
In addition to its powers under any provision of law specifically 
referred to in subsection (a), each of the agencies referred to in that 
subsection may exercise for the purpose of enforcing compliance with 
any requirement imposed under this title, any other authority con-
ferred on it by law. The exercise of the authorities of any of the 
agencies referred to in subsection (a) for the purpose of enforcing 
compliance with any requirement imposed under this title shall in 
no way preclude the exercise of such authorities for the purpose of 
enforcing compliance with any other provision of law not relatin^r 
to the prohibition of discrimination on the basis of sex or marital 
status with respect to any aspect of a credit transaction. 
"(c) Except to the extent that enforcement of the requirements 
imposed under this title is specifically committed to some other Gov-
ernment agency under subsection (a), the Federal Trade Commission 
shall enforce such requirements. For the purpose of the exercise by 
the Federal Trade Commission of its functions and powers under the 
Federal Trade Commission Act, a violation of any requirement 
imposed under this title shall be deemed a violation of a requirement 
imposed under that Act. All of the functions and powers of the Fed-
eral Trade Commission under the Federal Trade Commission Act are 
available to the Commission to enforce compliance by any person with 
the requirements imposed under this title, irrespective of whether that 
person is engaged in commerce or meets any other jurisdictional tests 
in the Federal Trade Commission Act. 
^^ use 58. 
"(d) The authority of the Board to issue regulations under this title 
does not impair the authority of any other agency designated in this 
section to make rules respecting its own procedures in enforcing com-
pliance with requirements imposed under this title. 
"§ 705. Relation to State laws 
"(a) A request for the signature of both parties to a marriage for 
^^ use i69id. 
the purpose of creating a valid lien, passing clear title, waiving 
inchoate rights to property, or assigning earnings, shall not constitute 
discrimination under this title: Provided, 
hoioever, That this pro-
vision shall not be construed to permit a creditor to take sex or marital 
15 use 1691e. 
1524 
PUBLIC LAW 93-495-OCT. 28, 1974 
[88 STAT. 
status into account in connection with the evaluation of creditworthi-
ness of any applicant. 
"(b) Consideration or application of State property laws directly 
or indirectly affecting creditworthiness shall not constitute discrimina-
tion for purposes of this title. 
"(c) Any provision of State law which prohibits the separate 
extension of consumer credit to each party to a marriage shall not 
apply in any case where each party to a marriage voluntarily applies 
for separate credit from the same creditor: Provided^ That in any case 
where such a State law is so preempted, each party to the marriage 
shall be solely responsible for the debt so contracted. 
"(d) When each party to a marriage separately and voluntarily 
applies for and obtains separate credit accounts with the same 
creditor, those accounts shall not be aggregated or otherwise com-
bined for purposes of determining permissible finance charges or 
permissible loan ceilings under the laws of any State or of the United 
States. 
"(e) Except as otherwise provided in this title, the applicant shall 
have the option of pursuing remedies under the provisions of this title 
in lieu of, but not in addition to, the remedies provided by the laws 
of any State or governmental subdivision relating to the prohibition of 
discrimination on the basis of sex or marital status with respect to 
any aspect of a credit transaction. 
"§ 706. Civil liability 
"(a) Any creditor who fails to comply with any requirement 
imposed under this title shall be liable to the aggrieved applicant in an 
amount equal to the sum of any actual damages sustained by such 
applicant acting either in an individual capacity or as a representative 
of a class. 
"(b) Any creditor who fails to comply with any requirement 
imposed under this title shall be liable to the aggrieved applicant for 
punitive damages in an amount not greater than $10,000, as determined 
by the court, in addition to any actual damages provided in section 
706(a) : Provided^ hoivever^ That in pursuing the recovery allowed 
under this subsection, the applicant may proceed only in an individual 
capacity and not as a representative of a class. 
"(c) Section 706(b) notwithstanding, any creditor who fails to 
comply with any requirement imposed under this title may be liable 
for punitive damages in the case of a class action in such amount as 
the court may allow, except that as to each member of the class no 
minimum recovery shall be applicable, and the total recovery in such 
action shall not exceed the lesser of $100,000 or 1 percent of the net 
worth of the creditor. In determining the amoiint of award in any 
class action, the court shall consider, among other relevant factors, the 
amount of any actual damages awarded, the frequency and persistence 
of failures of compliance by the creditor, the resources of the creditor, 
the number of persons adversely affected, and the extent to which 
the creditor's failure of compliance was intentional. 
"(d) When a creditor fails to comply with any requirement imposed 
under this title, an aggrieved applicant may institute a civil action for 
preventive relief, including an application for a permanent or tempo-
rary injunction, restraining order, or other action. 
"(e) In the case of any successful action to enforce the foregoing 
liability, the costs of the action, together with a reasonable attorney's 
fee as determined by the court shall be added to any damages awarded 
by the court under the provisions of subsections (a), (b), and (c) 
of this section. 
"(f) No provision of this title imposing anv liability shall apply 
to any act done or omitted in good faith in conformity with any rule. 
88 STAT. ] 
PUBLIC LAW 93-495-OCT. 28, 1974 
1525 
regulation, or interpretation thereof by the Board, notwithstanding 
that after such act or omission has occurred, such rule, regulation, or 
interpretation is amended, rescinded, or determined by judicial or 
other authority to be invalid for any reason. 
" is) Without regard to the amount in controversy, any action under 
this title may be brought in any United States district court, or in 
any other court of competent jurisdiction, within one year from the 
date of the occurrence of the violation. 
"§ 707. Effective date 
"This title takes effect upon the expiration of one year after the 
is use i69i 
date of its enactment.". 
note. 
TITLE VI—DISPOSITION OF ABANDONED MONEY 
ORDERS AND TRAVELER'S CHECKS 
FINDINGS 
SEC. 601. The Congress finds and declares that— 
1
2 use 2501. 
(1) the books and records of banking and financial organiza-
tions and business associations engaged in issuing and selling 
money orders and traveler's checks do not, as a matter of business 
practice, show the last known addresses of purchasers of such 
instruments; 
(2) a substantial majority of sudh purchasers reside in the 
States where such instruments are purchased ; 
(3) the States wherein the purchasers of money orders and 
traveler's checks reside should, as a matter of equity among the 
several States, be entitled to the proceeds of such instruments in 
the event of abandonment; 
, 
(4) it is a burden on interstate commerce that the proceeds of 
such instruments are not being distributed to the States entitled 
thereto; and 
(5) the cost of maintaining and retrieving addresses of pur-
chasers of money orders and traveler's checks is an additional 
burden on interstate commerce since it has been determined that 
most purchasers reside in the State of purchase of such instru-
ments. 
DEFINITIONS 
SEC. 602. As used in this title— 
1
2 use 2502. 
(1) "banking organization" means any bank, trust company, 
savings bank, safe deposit company, or a private banker engaged 
in business in the United States; 
(2) "business association" means any corporation (other than 
a public corporation), joint stock company, business trust, partner-
ship, or any association for business purposes of two or more 
individuals; and 
(3) "financial organization" means any savings and loan asso-
ciation, building and loan association, credit union, or investment 
company engaged in business in the United States. 
STATE ENTITLED TO ESCHEAT OR TAKE CUSTODY 
SEC. 603. Where any sum is payable on a money order, traveler's 
check, or other similar written instrument (other than a third party 
bank check) on which a banking or financial organization or a busi-
ness association is directly liable— 
(1) if the books and records of such banking or financial 
organization or business association show the State in which such 
38-194 O - 76 -14 Pt. 2 
12 u s e 
2 5 0 3 . 
1526 
PUBLIC LAW 93-496-OCT. 28, 1974 
[88 STAT. 
money order, traveler's check, or similar written instrument was 
purchased, that State shall be entitled exclusively to escheat or 
take custody of the sum payable on such instrument, to the extent 
of that State's power under its own laws to escheat or take custody 
of such sum; 
(2) if the books and records of such banking or financial orga-
nization or business association do not show the State in which 
such money order, traveler's check, or similar written instrument 
was purchased, the State in which the banking or 
financial 
organization or business association has its principal place of 
business shall be entitled to escheat or take custody of the sum 
payable on such money order, traveler's check, or similar written 
instrument, to the extent of that State's power under its own laws 
to escheat or take custody of such sum, until another State shall 
demonstrate by written evidence that it is the State of purchase ; 
or 
(3) if the books and records of such banking or financial orga-
nizations or business association show the State in which such 
money order, traveler's check, or similar written instrument was 
purchased and the laws of the State of purchase do not provide 
for the escheat or custodial taking of the sum payable on such 
instrument, the State in which the banking or financial organi-
zation or business association has its principal place of business 
shall be entitled to escheat or take custody of the sum payable 
on such money order, traveler's check, or similar written instru-
ment, to the extent of that State's power under its own laws to 
escheat or take custody of such sum, subject to the right of the 
State of purchase to recover such sum from the State of principal 
place of business if and when the law of the State of purchase 
makes provision for escheat or custodial taking of such sum. 
APPLICABILITY 
note ^^^^ ^^°^ 
^^^' ^^^* ^^^^ *i^l® shall be applicable to sums payable on money 
orders, traveler's checks, and similar written instruments deemed 
abandoned on or after February 1, 1965, except to the extent that 
such sums have been paid over to a State prior to January 1,1974. 
Approved October 28, 1974. 
Public Law 93-496 
October 28, 1974 
AN ACT 
[H. R. 15427] 
rji(j amend the Rail Passenger Service Act of 1970 to provide financial assistance 
to the National Railroad Passenger Corporation, and for other purposes. 
Be it enacted hy the Senate and House of Representatives 
of the 
mim^A^'t ^^^I97A' 
^^^'^^^ States of America in Congress assembled^ That this Act may be 
45 use 501 
cited as the "Amtrak Improvement Act of 1974". 
"National Rail- 
^^^- ^- Sectiou 304(b) of the Eail Passenger Service Act of 1970 
road Passenger 
(45 U.S.C. 544(b)) is amended by striking out "owned" and inserting 
Corporation, stock j ^ lieu thcreof "voted", and by adding at the end thereof the foUow-
ownership. 
7 
./ 
o