Released: July 06, 2008

A lesson on credit cards

Source: Carolyn Bigda, Baltimore Sun (Free Registration)

Recently, a subcommittee of the House Committee on Financial Services held a hearing on the marketing tactics companies use to pitch credit cards to college students. It is not the first time the issue has come up.

This time around, though, the economy is reeling from the blow-up of risky mortgages made to homebuyers, known as the subprime-loan crisis. So lawmakers are looking carefully at banking practices that might lead consumers deeper into debt.

This year, for example, the Federal Reserve proposed reining in certain credit-card practices, including some rate increases on outstanding balances.

And in February, Rep. Carolyn B. Maloney, a New York Democrat and chairwoman of the subcommittee on financial institutions and consumer credit, introduced legislation that called for similar changes.

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