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June 2009

Feds, State Advance
Consumer Protection Legislation

The U.S. House of Representatives just passed legislation, called the “Credit Cardholders’ Bill of Rights Act of 2009,” that would increase protections for credit cardholders. The action a deluge of consumer complaints that credit card companies were increasing interest rates and reducing grace periods. The bill passed the House on a 357–70 vote and would require credit card issuers to give consumers 45 days notice before a card’s interest rate could be increased, require statements to be mailed at least 25 days before payment is due, and prohibit “double cycle billing” in which interest charges are added to the second month of a bill for balances paid the prior month. Wisconsin Representatives Paul Ryan (R–Janesville) and James Sensenbrenner (R–Menomonee Falls) voted against the bill, while Representatives Tammy Baldwin (D–Madison), Steve Kagen (D–Appleton), Ron Kind (D–LaCrosse), Gwendolyn Moore (D–Milwaukee), David Obey (D–Wausau), and Tom Petri (R–Fond du Lac) voted for the bill.

The bill is strongly supported by President Obama and the bill is being considered by the U.S. Senate as this column went to press. 

Wisconsin Acts

Not to be outdone, the Wisconsin Legislature has also been working on consumer protection legislation. In late April, Governor Jim Doyle signed into law two bills sponsored by perhaps the Legislature’s leading consumer advocate, Senator Jon Erpenbach (D–Middleton). The first bill was the subject of my August 2008 WECN article, “Court May Weaken Home Buyers’ Protections,” in which I expressed concern about a Wisconsin Supreme Court decision reducing home-buyer protections by prohibiting suits for fraud when the seller allegedly did not disclose a substantial defect in the home. According to Senator Erpenbach, “This law will help home buyers have a chance if they were sold a home with problems that the seller knew existed. It is not easy to prove fraud, but the cases where a buyer can provide it should be able to have a legal remedy. When you buy a home, you should have some peace of mind that if the seller lied about the condition of the home, you can hold them accountable.”

Senator Erpenbach’s second law reflects back to the 1999 tragedy when seven young members of a traveling sales crew lost their lives in an accident on Interstate 90 near Janesville. I served as the state’s Consumer Protection administrator then and I still recall so many of the details around that terrible accident and our very extensive efforts to make the owners of the traveling sales crew company liable for the harm they caused.

The 1999 accident occurred as we were attempting to crack down on sales crews because of the large number of consumer complaints we had received about items being paid for and never being delivered, along with some terrible stories we were hearing about how some of the often very young sales crews were being treated on the road.

Senator Erpenbach’s new law requires any traveling sales crew seeking to operate or recruit crews within the state to first obtain a “certificate of registration” from the state Department of Workforce Development. Crew members will now be required to carry the certificates with them and register with the municipal clerk before going door-to-door in local communities. This bill is long overdue and will help ensure door-to-door salespersons are legitimate, and by doing so, help protect the young persons who often travel on these sales crews.


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