CU Says Colleges May Be Violating CARD Act; Will Colleges Respond?
By Consumers Union on Monday, March 2nd, 2015
In the 2000s, colleges and credit card companies got a lot of flack for entering into agreements to aggressively market credit cards to students on campus. After the 2008 financial collapse, Congress passed the CARD Act – which, among other things, requires all schools with credit card agreements to make them available to the public.
Now that the CARD Act has been around for a few years, how are the schools doing when it comes to making their credit card contracts public? Well, not great. Over a three-day period in January, we contacted 10 schools with the largest active account volume that did not post their agreements or offer guidance for how to get them online. None of the schools provided us with any information or copies of their college credit card agreements.
We reported our findings to the CFPB, letting them know that schools may be violating the law and asking them to investigate further.
It’s been less than two weeks since our letter to the CFPB, and now we’ve received a letter from Yale University telling us they have posted their alumni credit card agreement online.
This is a good first step, but we want all schools to step up and disclose all of their agreements – to market to students on campus, as well as to alumni. The public has a right to know whether these contracts are designed to give students and alumni a good deal, or simply to help the schools’ bottom lines.