Liberal Rep. Barney Frank is adamant about the rewriting of the rules that govern Wall Street and is taking aim at the big banks in the industry. Frank says that big banks should play nice or else Congress will enact and implement the dreaded credit card Bill earlier than originally planned. Frank has observed that the big corporations in the industry are not playing nice to their consumers, which has prodded him to consider enacting the Credit Card Bill much earlier, thereby making life for these banks more difficult.
It was during last spring when Rep. Frank assisted in pushing the Credit Card Bill through Congress, which imposes new and stricter rules on the lenders in the industry. One of the strict rules that has caught the attention of banks is the limitation as to how and when banks would hike rates. With this announcement came the dreaded implementation date of mid-February 2010, when most of the rule changes would take place. This date was set by Congress so that the banks would be given ample time for the needed preparations, as well as the transitions banks and their employees would need to undergo as well.
However, Rep. Barney Frank, who chaired the recent hearing of the House Financial Services Committee, has observed and voiced out how lenders have been abusing this grace period. According to Frank, this grace period has been used by banks to hike rates so that increases would be implemented before the new rules would be enacted. Because of this, Frank has introduced legislation that aims to move the enactment date as early as December 1, 2009.
Rep. Frank further states how very clear it is the need for protection against the exploitation carried about by the big banks today. This kind of protection for the consumer should not have to wait anymore, which is why Rep Frank sees the need to implement the new Credit Card Bill a lot sooner than planned.
Some of the lobbyists have expressed speculation about Frank's interest in the bill as a warning to big banks, that they should pay more attention to protecting the customer instead of implementing hike rates before the new rules are enacted. Still, banks contend that these tougher restrictions, as well as the proposed creation of the new federal regulator would only hurt the extent of credit made available to credit users. As a result, some banks have even started adopting policies that are consumer-friendly. Even the Bank of America Corporation has pledged that they would not hike rates before February, which is what Rep. Frank wants to see.
Rep. Frank does acknowledge the efforts of the Bank of America. However, he contends that there are still a lot of lenders who have abused the given grace period. The motion to enact the Credit Card Bill earlier is still being strongly considered by the Congress.