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Credit Repair Organizations Act

SEC. 2451. REGULATION OF CREDIT REPAIR ORGANIZATIONS.
  Title IV of the Consumer Credit Protection Act (Public Law 90-321, 82 Stat. 164) is amended to read as follows:
TITLE IV–CREDIT REPAIR ORGANIZATIONS”
Sec.
401. Short title.
402. Findings and purposes.
403. Definitions.
404. Prohibited practices.
405. Disclosures.
406. Credit repair organizations contracts.
407. Right to cancel contract.
408. Noncompliance with this title.
409. Civil liability.
410. Administrative enforcement.
411. Statute of limitations.
412. Relation to State law.
413. Effective date.
SEC. 401. SHORT TITLE.(2)
This title may be cited as the ‘Credit Repair Organizations Act’.
SEC. 402. FINDINGS AND PURPOSES.(3)
(a) Findings.–The Congress makes the following findings:
(1) Consumers have a vital interest in establishing and maintaining their credit worthiness and credit standing in order to obtain and use credit. As a result, consumers who have experienced credit problems may seek assistance from credit repair organizations, which offer to improve the credit standing of such consumers.

(2) Certain advertising and business practices of some companies engaged in the business of credit repair services have worked a financial hardship upon consumers, particularly those of limited economic means and who are inexperienced in credit matters.
(b) Purposes.–The purposes of this title are–
(1) To ensure that prospective buyers of the services of credit repair organizations are provided with the information necessary to make an informed decision regarding the purchase of such services; and

(2) To protect the public from unfair or deceptive advertising and business practices by credit repair organizations.
SEC. 403. DEFINITIONS.(4)
For purposes of this title, the following definitions apply:
(1) Consumer. — The term ‘consumer’ means an individual.
(2) Consumer credit transaction. — The term ‘consumer credit transaction’ means any transaction in which credit is offered or extended to an individual for personal, family, or household purposes.
(3) Credit repair organization. — The term ‘credit repair organization’–
(A) Means any person who uses any instrumentality of interstate commerce or the mails to sell, provide, or perform (or represent that such person can or will sell, provide, or perform) any service, in return for the payment of money or other valuable consideration, for the express or implied purpose of–

(i) Improving any consumer’s credit record, credit history, or credit rating; or

(ii) Providing advice or assistance to any consumer with regard to any activity or service described in clause (i); and

(B) Does not include–

(i) Any nonprofit organization, which is exempt from taxation under section 501(c)(3) of the Internal Revenue Code of 1986;

(ii) Any creditor (as defined in section 103 of the Truth in Lending Act),(5) with respect to any consumer, to the extent the creditor is assisting the consumer to restructure any debt owed by the consumer to the creditor; or

(iii) Any depository institution (as that term is defined in section 3 of the Federal Deposit Insurance Act) or any Federal or State credit union (as those terms are defined in section 101 of the Federal Credit Union Act), or any affiliate or subsidiary of such a depository institution or credit union.
(4) Credit.–The term ‘credit’ has the meaning given to such term in section 103(e) of this Act.(6)
SEC. 404. PROHIBITED PRACTICES.(7)
(a) In General.–No person may–
(1) Make any statement, or counsel or advise any consumer to make any statement, which is untrue or misleading (or which, upon the exercise of reasonable care, should be known by the credit repair organization, officer, employee, agent, or other person to be untrue or misleading) with respect to any consumer’s credit worthiness, credit standing, or credit capacity to–

(A) Any consumer reporting agency (as defined in section 603(f) of this Act);(8) or

(B) Any person–

(i) Who has extended credit to the consumer; or

(ii) To whom the consumer has applied or is applying for an extension of credit;

(2) Make any statement, or counsel or advise any consumer to make any statement, the intended effect of which is to alter the consumer’s identification to prevent the display of the consumer’s credit record, history, or rating for the purpose of concealing adverse information that is accurate and not obsolete to–

(A) Any consumer-reporting agency;

(B) Any person–

(i) Who has extended credit to the consumer; or

(ii) To whom the consumer has applied or is applying for an extension of credit;

(3) Make or use any untrue or misleading representation of the services of the credit repair organization; or

(4) Engage, directly or indirectly, in any act, practice, or course of business that constitutes or results in the commission of, or an attempt to commit, a fraud or deception on any person in connection with the offer or sale of the services of the credit repair organization.
(b) Payment in Advance.–No credit repair organization may charge or receive any money or other valuable consideration for the performance of any service which the credit repair organization has agreed to perform for any consumer before such service is fully performed.
SEC. 405. DISCLOSURES.(9)
(a) Disclosure Required.–Any credit repair organization shall provide any consumer with the following written statement before any contract or agreement between the consumer and the credit repair organization is executed:
‘Consumer Credit File Rights Under State and Federal Law
You have a right to dispute inaccurate information in your credit report by contacting the credit bureau directly. However, neither you nor any ”credit repair” company or credit repair organization has the right to have accurate, current, and verifiable information removed from your credit report. The credit bureau must remove accurate, negative information from your report only if it is over 7 years old. Bankruptcy information can be reported for 10 years.
You have a right to obtain a copy of your credit report from a credit bureau. You may be charged a reasonable fee. There is no fee, however, if you have been turned down for credit, employment, insurance, or a rental dwelling because of information in your credit report within the preceding 60 days. The credit bureau must provide someone to help you interpret the information in your credit file. You are entitled to receive a free copy of your credit report if you are unemployed and intend to apply for employment in the next 60 days, if you are a recipient of public welfare assistance, or if you have reason to believe that there is inaccurate information in your credit report due to fraud.
You have a right to sue a credit repair organization that violates the Credit Repair Organization Act. This law prohibits deceptive practices by credit repair organizations.
You have the right to cancel your contract with any credit repair organization for any reason within 3 business days from the date you signed it.
Credit bureaus are required to follow reasonable procedures to ensure that the information they report is accurate. However, mistakes may occur.
You may, on your own, notify a credit bureau in writing that you dispute the accuracy of information in your credit file. The credit bureau must then reinvestigate and modify or remove inaccurate or incomplete information. The credit bureau may not charge any fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the credit bureau.
If the credit bureau’s reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the credit bureau, to be kept in your file, explaining why you think the record is inaccurate. The credit bureau must include a summary of your statement about disputed information with any report it issues about you.
The Federal Trade Commission regulates credit bureaus and credit repair organizations. For more information contact:
The Public Reference Branch
Federal Trade Commission
Washington, D.C. 20580′.
(b) Separate Statement Requirement.–The written statement required under this section shall be provided as a document which is separate from any written contract or other agreement between the credit repair organization and the consumer or any other written material provided to the consumer.
(c) Retention of Compliance Records.–
(1) In general.–The credit repair organization shall maintain a copy of the statement signed by the consumer acknowledging receipt of the statement.

(2) Maintenance for 2 years.–The copy of any consumer’s statement shall be maintained in the organization’s files for 2 years after the date on which the statement is signed by the consumer.
SEC. 406. CREDIT REPAIR ORGANIZATIONS CONTRACTS.(10)
(a) Written Contracts Required.–No services may be provided by any credit repair organization for any consumer–
(1) Unless a written and dated contract (for the purchase of such services) which meets the requirements of subsection (b) has been signed by the consumer; or

(2) Before the end of the 3-business-day period beginning on the date the contract is signed.
(b) Terms and Conditions of Contract.–No contract referred to in subsection (a) meets the requirements of this subsection unless such contract includes (in writing)–
(1) The terms and conditions of payment, including the total amount of all payments to be made by the consumer to the credit repair organization or to any other person;

(2) A full and detailed description of the services to be performed by the credit repair organization for the consumer, including–

(A) All guarantees of performance; and

(B) An estimate of–

(i) The date by which the performance of the services (to be performed by the credit repair organization or any other person) will be complete; or

(ii) The length of the period necessary to perform such services;

(3) The credit repair organization’s name and principal business address; and

(4) A conspicuous statement in bold face type, in immediate proximity to the space reserved for the consumer’s signature on the contract, which reads as follows: ‘You may cancel this contract without penalty or obligation at any time before midnight of the 3rd business day after the date on which you signed the contract. See the attached notice of cancellation form for an explanation of this right.’.
SEC. 407. RIGHT TO CANCEL CONTRACT.(11)
(a) In General. — Any consumer may cancel any contract with any credit repair organization without penalty or obligation by notifying the credit repair organization of the consumer’s intention to do so at any time before midnight of the 3rd business day which begins after the date on which the contract or agreement between the consumer and the credit repair organization is executed or would, but for this subsection, become enforceable against the parties.
(b) Cancellation Form and Other Information. — Each contract shall be accompanied by a form, in duplicate, which has the heading ‘Notice of Cancellation’ and contains in bold face type the following statement:
‘You may cancel this contract, without any penalty or obligation, at any time before midnight of the 3rd day which begins after the date the contract is signed by you.
To cancel this contract, mail or deliver a signed, dated copy of this cancellation notice, or any other written notice to (name of credit repair organization) at (address of credit repair organization) before midnight on (date)
I hereby cancel this transaction,
(Date)
(Purchaser’s signature).’.
(c) Consumer Copy of Contract Required.–Any consumer who enters into any contract with any credit repair organization shall be given, by the organization–
(1) A copy of the completed contract and the disclosure statement required under section 405; and

(2) A copy of any other document the credit repair organization requires the consumer to sign, at the time the contract or the other document is signed.
SEC. 408. NONCOMPLIANCE WITH THIS TITLE.(12)
(a) Consumer Waivers Invalid.–Any waiver by any consumer of any protection provided by or any right of the consumer under this title–
(1) Shall be treated as void; and

(2) May not be enforced by any Federal or State court or any other person.
(b) Attempt To Obtain Waiver.–Any attempt by any person to obtain a waiver from any consumer of any protection provided by or any right of the consumer under this title shall be treated as a violation of this title.
(c) Contracts Not in Compliance.–Any contract for services which does not comply with the applicable provisions of this title–
(1) Shall be treated as void; and

(2) May not be enforced by any Federal or State court or any other person.
SEC. 409. CIVIL LIABILITY.(13)
(a) Liability Established.–Any person who fails to comply with any provision of this title with respect to any other person shall be liable to such person in an amount equal to the sum of the amounts determined under each of the following paragraphs:
(1) Actual damages.–The greater of–

(A) The amount of any actual damage sustained by such person as a result of such failure; or

(B) Any amount paid by the person to the credit repair organization.

(2) Punitive damages.–

(A) Individual actions.–In the case of any action by an individual, such additional amount as the court may allow.

(B) Class actions.–In the case of a class action, the sum of–

(i) The aggregate of the amount which the court may allow for each named plaintiff; and

(ii) The aggregate of the amount which the court may allow for each other class member, without regard to any minimum individual recovery.

(3) Attorneys’ fees.–In the case of any successful action to enforce any liability under paragraph (1) or (2), the costs of the action, together with reasonable attorneys’ fees.
(b) Factors to Be Considered in Awarding Punitive Damages.–In determining the amount of any liability of any credit repair organization under subsection (a)(2), the court shall consider, among other relevant factors–
(1) The frequency and persistence of noncompliance by the credit repair organization;

(2) The nature of the noncompliance;

(3) The extent to which such noncompliance was intentional; and

(4) In the case of any class action, the number of consumers adversely affected.
SEC. 410. ADMINISTRATIVE ENFORCEMENT.(14)
(a) In General.–Compliance with the requirements imposed under this title with respect to credit repair organizations shall be enforced under the Federal Trade Commission Act by the Federal Trade Commission.
(b) Violations of This Title Treated as Violations of Federal Trade Commission Act.–
(1) In general. — For the purpose of the exercise by the Federal Trade Commission of the Commission’s functions and powers under the Federal Trade Commission Act, any violation of any requirement or prohibition imposed under this title with respect to credit repair organizations shall constitute an unfair or deceptive act or practice in commerce in violation of section 5(a) of the Federal Trade Commission Act.

(2) Enforcement authority under other law. — All functions and powers of the Federal Trade Commission under the Federal Trade Commission Act shall be available to the Commission to enforce compliance with this title by any person subject to enforcement by the Federal Trade Commission pursuant to this subsection, including the power to enforce the provisions of this title in the same manner as if the violation had been a violation of any Federal Trade Commission trade regulation rule, without regard to whether the credit repair organization–

(A) Is engaged in commerce; or

(B) Meets any other jurisdictional tests in the Federal Trade Commission Act.
(c) State Action for Violations.–
(1) Authority of states. — In addition to such other remedies as are provided under State law, whenever the chief law enforcement officer of a State, or an official or agency designated by a State, has reason to believe that any person has violated or is violating this title, the State–

(A) May bring an action to enjoin such violation;

(B) May bring an action on behalf of its residents to recover damages for which the person is liable to such residents under section 409 as a result of the violation; and

(C) In the case of any successful action under subparagraph (A) or (B), shall be awarded the costs of the action and reasonable attorney fees as determined by the court.

(2) Rights of commission.–

(A) Notice to commission.–The State shall serve prior written notice of any civil action under paragraph (1) upon the Federal Trade Commission and provide the Commission with a copy of its complaint, except in any case where such prior notice is not feasible, in which case the State shall serve such notice immediately upon instituting such action.

(B) Intervention.–The Commission shall have the right–

(i) To intervene in any action referred to in subparagraph (A);

(ii) Upon so intervening, to be heard on all matters arising in the action; and

(iii) To file petitions for appeal.

(3) Investigator powers. — For purposes of bringing any action under this subsection, nothing in this subsection shall prevent the chief law enforcement officer, or an official or agency designated by a State, from exercising the powers conferred on the chief law enforcement officer or such official by the laws of such State to conduct investigations or to administer oaths or affirmations or to compel the attendance of witnesses or the production of documentary and other evidence.

(4) Limitation. — Whenever the Federal Trade Commission has instituted a civil action for violation of this title, no State may, during the pendency of such action, bring an action under this section against any defendant named in the complaint of the Commission for any violation of this title that is alleged in that complaint.
SEC. 411. STATUTE OF LIMITATIONS.(15)
Any action to enforce any liability under this title may be brought before the later of–
(1) The end of the 5-year period beginning on the date of the occurrence of the violation involved; or

(2) In any case in which any credit repair organization has materially and willfully misrepresented any information which–

(A) The credit repair organization is required, by any provision of this title, to disclose to any consumer; and

(B) Is material to the establishment of the credit repair organization’s liability to the consumer under this title, the end of the 5-year period beginning on the date of the discovery by the consumer of the misrepresentation.
SEC. 412. RELATION TO STATE LAW.(16)
This title shall not annul, alter, affect, or exempt any person subject to the provisions of this title from complying with any law of any State except to the extent that such law is inconsistent with any provision of this title, and then only to the extent of the inconsistency.
SEC. 413. EFFECTIVE DATE.(17)
This title shall apply after the end of the 6-month period beginning on the date of the enactment of the Credit Repair Organizations Act,(18) except with respect to contracts entered into by a credit repair organization before the end of such period.”.

1. Pub. L. No. 104-208, 110 Stat. 3009 (Sept. 30, 1996). The amendments to the credit statutes are in Title II of the Act, entitled “Economic Growth and Regulatory Paperwork Reduction.” The footnotes in this copy of the Act are not part of the Act, but are cross-references inserted by the FTC staff for the convenience of the reader.
2. To be codified as 15 U.S.C. § 1679.
3. To be codified as 15 U.S.C. § 1679a.
4. To be codified as 15 U.S.C. § 1679b.
5. Truth in Lending Act § 103(f) states in pertinent part: “The term ‘creditor’ refers only to creditors who regularly extend, or arrange for the 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 pf property or services, or otherwise.
6. TILA § 103(e) states: “The term ‘credit’ means the right granted by a creditor to a debtor to defer payment of debt or to incur debt and defer its payment.”
7. To be codified as 15 U.S.C. § 1679c.
8. Fair Credit Reporting Act (FCRA) § 603(f) states: “The term ‘consumer reporting agency’ means any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports.”
9. To be codified as 15 U.S.C. § 1679d.
10. To be codified as 15 U.S.C. § 1679e.
11. To be codified as 15 U.S.C. § 1679f.
12. To be codified as 15 U.S.C. § 1679g.
13. To be codified as 15 U.S.C. § 1679h.
14. To be codified as 15 U.S.C. § 1679i.
15. To be codified as 15 U.S.C. § 1679j.
16. To be codified as 15 U.S.C. § 1679k.
17. To be codified as 15 U.S.C. § 1679l.
18. The statute was signed by the President on September 30, 1996.
The Fair Credit Billing Act is a credit protection law that sets up procedures requiring creditors to promptly correct billing mistakes; allows you to withhold payments on defective goods; and requires creditors to promptly credit your payments.
Open-end consumer credit plans
Disclosure for credit and charge card applications and solicitations
Additional credit and charge card disclosure information
Telephone solicitations
Applications and solicitations by other means
General information without any specific term
Charge card applications and solicitations
Additional Charge Card Applications and Solicitations Information
Applications and solicitations by other means
Issuers of charge cards, which provide access to open end consumer credit plans.
Charge card defined
Disclosure prior to renewal
Insurance in connection with certain open-end credit card plans

Up 1. Open-end consumer credit plans
Required disclosures by creditor:
Before opening any account under an open-end consumer credit plan, the creditor shall disclose to the person to whom credit is to be extended each of the following items, to the extent applicable:
(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 disclosure, impose no such finance charge if payment is received after the termination of such time period. If no such time period is provided, the creditor shall disclose such fact.
(2) The method of determining the balance upon which a finance charge will be imposed.
(3) The method of determining the amount of the finance charge, including any minimum or fixed amount imposed as a finance charge.
(4) Where one or more periodic rates may be used to compute the finance charge, each such rate, the range of balances to which it is applicable, and the corresponding nominal annual percentage rate determined by multiplying the periodic rate by the number of periods in a year.
(5) Identification of other charges, which may be imposed as part of the plan, and their method of computation, in accordance with regulations of the Board.
(6) In cases where the credit is or will be secured, a statement that a security interest has been or will be taken in
(A) The property purchased as part of the credit transaction, or
(B) Property not purchased as part of the credit transaction identified by item or type.
(7) A statement, in a form prescribed by regulations of the Board of the protection provided by sections 1666 and 1666i of this title to an obligor and the creditor’s responsibilities under sections 1666a and 1666i of this title. With respect to one billing cycle per calendar year, at intervals of not less than six months or more than eighteen months, the creditor shall transmit such statement to each obligor to whom the creditor is required to transmit a statement pursuant to subsection (b) of this section for such billing cycle.
(8) In the case of any account under an open end consumer credit plan which provides for any extension of credit which is secured by the consumer’s principal dwelling, any information which;
(A) Is required to be disclosed under section 1637a(a) of this title; and
(B) The Board determines is not described in any other paragraph of this subsection.
(9) Statement required with each billing cycle. The creditor of any account under an open end consumer credit plan shall transmit to the obligor, for each billing cycle at the end of which there is an outstanding balance in that account or with respect to which a finance charge is imposed, a statement setting forth each of the following items to the extent applicable:
(1) The outstanding balance in the account at the beginning of the statement period.
(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 the Board sufficient to enable the obligor either to identify the transaction or to relate it to copies of sales vouchers or similar instruments previously furnished, except that a creditor’s failure to disclose such information in accordance with this paragraph shall not be deemed a failure to comply with this part or this subchapter if:
(A) The creditor maintains procedures reasonably adapted to procure and provide such information, and
(B) The creditor responds to and treats any inquiry for clarification or documentation as a billing error and an erroneously billed amount under section 1666 of this title.
In lieu of complying with the requirements of the previous sentence, in the case of any transaction in which the creditor and seller are the same person, as defined by the Board, and such person’s open end credit plan has fewer than 15,000 accounts, the creditor may elect to provide only the amount and date of each extension of credit during the period and the seller’s name and location where the transaction took place if:
(A) A brief identification of the transaction has been previously furnished, and
(B) The creditor responds to and treats any inquiry for clarification or documentation as a billing error and an erroneously billed amount under section 1666 of this title.
(3) The total amount credited to the account during the period.
(4) The amount of any finance charge added to the account during the period, itemized to show the amounts, if any, due to the application of percentage rates and the amount, if any, imposed as a minimum or fixed charge.
(5) Where one or more periodic rates may be used to compute the finance charge, each such rate, the range of balances to which it is applicable, and, unless the annual percentage rate (determined under section 1606(a)(2) of this title) is required to be disclosed pursuant to paragraph (6), the corresponding nominal annual percentage rate determined by multiplying the periodic rate by the number of periods in a year.
(6) Where the total finance charge exceeds 50 cents for a monthly or longer billing cycle, or the pro rata part of 50 cents for a billing cycle shorter than monthly, the total finance charge expressed as an annual percentage rate (determined under section 1606(a)(2) of this title), except that if the finance charge is the sum of two or more products of a rate times a portion of the balance, the creditor may, in lieu of disclosing a single rate for the total charge, disclose each such rate expressed as an annual percentage rate, and the part of the balance to which it is applicable.
(7) The balance on which the finance charges were computed and a statement of how the balance was determined. If the balance is determined without first deducting all credits during the period, that fact and the amount of such payments shall also be disclosed.
(8) The outstanding balance in the account at the end of the period.
(9) 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.
(10) The address to be used by the creditor for the purpose of receiving billing inquiries from the obligor.
Up 2. Disclosure in credit and charge card applications and solicitations (direct mail applications and solicitations)
Any application to open a credit card account for any person under an open end consumer credit plan, or a solicitation to open such an account without requiring an application, that is mailed to consumers shall disclose the following information, subject to subsection (e) of this section and section 1632(c) of this title:
Annual percentage rates
Each annual percentage rate applicable to extensions of credit under such credit plan.
Where an extension of credit is subject to a variable rate, the fact that the rate is variable, the annual percentage rate in effect at the time of the mailing, and how the rate is determined.
Where more than one rate applies, the range of balances to which each rate applies.
Annual and other fees
Any annual fee, other periodic fee, or membership fee imposed for the issuance or availability of a credit card, including any account maintenance fee or other charge imposed based on activity or inactivity for the account during the billing cycle.
Any minimum finance charge imposed for each period during which any extension of credit which is subject to a finance charge is outstanding.
Any transaction charge imposed in connection with use of the card to purchase goods or services.
Grace period:
The date by which or the period within which any credit extended under such credit plan for purchases of goods or services must be repaid to avoid incurring a finance charge, and, if no such period is offered, such fact shall be clearly stated.
If the length of such ”grace period” varies, the card issuer may disclose the range of days in the grace period, the minimum number of days in the grace period, or the average number of days in the grace period, if the disclosure is identified as such.
Balance calculation method
The name of the balance calculation method used in determining the balance on which the finance charge is computed if the method used has been defined by the Board, or a detailed explanation of the balance calculation method used if the method has not been so defined.
In prescribing regulations to carry out this clause, the Board shall define and name not more than the 5 balance calculation methods determined by the Board to be the most commonly used methods.
Up 3. Other Credit and Charge Card Disclosure Information
In addition to the information required to be disclosed under subparagraph (A), each application or solicitation to which such subparagraph applies shall disclose clearly and conspicuously the following information, subject to subsections (e) and (f) of this section:
Cash advance fee
Any fee imposed for an extension of credit in the form of cash.
Any fee imposed for a late payment.
Over-the-limit fee
Any fee imposed in connection with an extension of credit in excess of the amount of credit authorized to be extended with respect to such account.
Up 4. Telephone solicitations
In general any telephone solicitation to open a credit card account for any person under an open end consumer credit plan, the person making the solicitation shall orally disclose the information described in this Act as required except telephone solicitations shall not be required to orally disclose information described in this Act if the credit card issuer:
Does not impose any fee;
Does not impose any fee in connection with telephone solicitations unless the consumer signifies acceptance by using the card;
The card issuer discloses clearly and conspicuously in writing the information described in paragraph (1) within 30 days after the consumer requests the card, but in no event later than the date of delivery of the card; and
The card issuer discloses clearly and conspicuously that the consumer is not obligated to accept the card or account and the consumer will not be obligated to pay any of the fees or charges disclosed unless the consumer elects to accept the card or account by using the card.
Up 5. Applications and solicitations by other means
In general
Any application to open a credit card account for any person under an open end consumer credit plan, and any solicitation to open such an account without requiring an application, that is made available to the public or contained in catalogs, magazines, or other publications shall meet the disclosure requirements of this Act.
Specific information
An application or solicitation described in above meets the requirement of this subparagraph if such application or solicitation contains -
the information – described in herein, in the form required under section 1632(c) of this title, subject to subsection (e) and described in a clear and conspicuous form, subject to subsections (e) and (f) of this section;
A statement, in a conspicuous and prominent location on the application or solicitation, that -
the information is accurate as of the date the application or solicitation was printed;
the information contained in the application or solicitation is subject to change after such date; and the applicant should contact the creditor for information on any change in the information contained in the application or solicitation since it was printed; a clear and conspicuous disclosure of the date the application or solicitation was printed; and a disclosure, in a conspicuous and prominent location on the application or solicitation, of a toll free telephone number or a mailing address at which the applicant may contact the creditor to obtain any change in the information provided in the application or solicitation since it was printed.
Up 6. General information without any specific term
An application or solicitation described in subparagraph above meets the requirement of this subparagraph if such application or solicitation contains a statement, in a conspicuous and prominent location on the application or solicitation, that:
There are costs associated with the use of credit cards; and the applicant may contact the creditor to request disclosure of specific information of such costs by calling a toll free telephone number or by writing to an address, specified in the application;
Contains a disclosure, in a conspicuous and prominent location on the application or solicitation, of a toll free telephone number and a mailing address at which the applicant may contact the creditor to obtain such information;
Up 7. Charge card applications and solicitations
(A) In general
Any application or solicitation to open a charge card account shall disclose clearly and conspicuously the following information in the form required by section 1632(c) of this title, subject to subsection (e) of this section:
Any annual fee, other periodic fee, or membership fee imposed for the issuance or availability of the charge card, including any account maintenance fee or other charge imposed based on activity or inactivity for the account during the billing cycle.
Any transaction charge imposed in connection with use of the card to purchase goods or services.
A statement that charges incurred by use of the charge card are due and payable upon receipt of a periodic statement rendered for such charge card account.
Up 8. Additional Charge Card Applications and Solicitations Information
In addition to the information required to be disclosed under subparagraph (A), each written application or solicitation to which such subparagraph applies shall disclose clearly and conspicuously the following information, subject to subsections
Cash advance fee
Any fee imposed for an extension of credit in the form of cash.
Late fee
Any fee imposed for a late payment.
Over-the-limit fee
Any fee imposed in connection with an extension of credit in excess of the amount of credit authorized to be extended with respect to such account.
Up 9. Applications and solicitations by other means
Any application to open a charge card account, and any solicitation to open such an account without requiring an application, that is made available to the public or contained in catalogs, magazines, or other publications shall contain -
The information – described in subparagraph (A) in the form required under section 1632(c) of this title, subject to subsection (e) of this section, and (II) described in subparagraph (B) in a clear and conspicuous form, subject to subsections (e) and (f) of this section;
A statement, in a conspicuous and prominent location on the application or solicitation, that -
The information is accurate as of the date the application or solicitation was printed;
The information contained in the application or solicitation is subject to change after such date; and
The applicant should contact the creditor for information on any change in the information contained in the application or solicitation since it was printed;
A clear and conspicuous disclosure of the date the application or solicitation was printed; and
A disclosure, in a conspicuous and prominent location on the application or solicitation, of a toll free telephone number or a mailing address at which the applicant may contact the creditor to obtain any change in the information provided in the application or solicitation since it was printed.
Up 10. Issuers of charge cards, which provide access to open end consumer credit plans.
If a charge card permits the card holder to receive an extension of credit under an open end consumer credit plan, which is not maintained by the charge card issuer, the charge card issuer may provide the information described in subparagraphs (A) and (B) in the form required by such subparagraphs in lieu of the information required to be provided under paragraph (1), (2), or (3) with respect to any credit extended under such plan, if the charge card issuer discloses clearly and conspicuously to the consumer in the application or solicitation that -
the charge card issuer will make an independent decision as to whether to issue the card;
the charge card may arrive before the decision is made with respect to an extension of credit under an open end consumer credit plan; and approval by the charge card issuer does not constitute approval by the issuer of the extension of credit.
The information required to be disclosed under paragraph (1) shall be provided to the charge card holder by the creditor, which maintains such open-end consumer credit plan before the first extension of credit under such plan.
Up 11. Charge card defined
For the purposes of this subsection, the term ”charge card” means a card, plate, or other single credit device that may be used from time to time to obtain credit, which is not subject to a finance charge.
Up 12. Disclosure prior to renewal
In general
A card issuer that imposes any fee shall transmit to a consumer at least 30 days prior to the scheduled renewal date of the consumer’s credit or charge card account a clear and conspicuous disclosure of -
The date by which, the month by which, or the billing period at the close of which, the account will expire if not renewed;
The method by which the consumer may terminate continued credit availability under the account.
Up 13. Insurance in connection with certain open end credit card plans
Change in insurance carrier
Whenever a card issuer that offers any guarantee or insurance for repayment of all or part of the outstanding balance of an open end credit card plan proposes to change the person providing that guarantee or insurance, the card issuer shall send each insured consumer written notice of the proposed change not less than 30 days prior to the change, including notice of any increase in the rate or substantial decrease in coverage or service which will result from such change. Such notice may be included on or with the monthly statement provided to the consumer prior to the month in which the proposed change would take effect.
Notice of new insurance coverage in any case in which a proposed change occurs,
The insured consumer shall be given the name and address of the new guarantor or insurer and a copy of the policy or group certificate containing the basic terms and conditions, including the premium rate to be charged.
Right to discontinue guarantee or insurance
The notices required under paragraphs (1) and (2) shall each include a statement that the consumer has the option to discontinue the insurance or guarantee.
No preemption of State law
No provision of this subsection shall be construed as superseding any provision of State law, which is applicable to the regulation of insurance.
Board definition of substantial decrease in coverage or service
The Board shall define, in regulations, what constitutes a ”substantial decrease in coverage or service” for purposes of paragraph

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