Regulators Seek Strict Policies for Financial Firms

WASHINGTON -- The Federal Reserve and two other regulators plan to propose strict policies on credit-card issuers after criticism that card companies charge too many hidden fees and unfairly raise interest rates on borrowers, The Wall Street Journal reported Tuesday.

Banking officials are bracing for the proposal and raising concerns about the plan's breadth. It would mark one of the government's most aggressive efforts to curb credit-card practices in decades and could affect more than 10,000 financial institutions, the paper reported.

The agencies, which include the Office of Thrift Supervision and the National Credit Union Administration, would propose labeling several credit-card and banking practices as "unfair or deceptive," according to people familiar with the plan. The Fed has scheduled a public meeting on Friday to issue the plan. The proposal is expected to include curbs on the fees depositors are charged when they overdraw their bank account, the paper reported.

-- NYSSCPA.org News Staff

Posted on 4/29/08