Consumer groups say new Fed rules not strong enough - WKOW 27: Madison, WI Breaking News, Weather and Sports

Consumer groups say new Fed rules not strong enough


MADISON (WKOW) -- On Tuesday, we reported on the new federal rules affecting gift cards.

Wednesday, the Consumers Union released a statement saying the new rules are not strong enough.

The group called on the Federal Reserve to issue new, stronger rules.

You can read the entire statement by clicking here.  Here's the summary from Consumers Union's website:

"These proposed rules fall short in providing consumers with the assurance they need that they will not lose the value on their gift cards to unfavorable terms and conditions. We respectfully ask the Board to go beyond these proposed rules and to implement regulations for the following, all of which were authorized, although not required, by the Credit CARD Act:
•Determine caps on dormancy fees, inactivity charge or fees, or service fee amounts;
•Adopt a broad definition of "service fee;"
•Determine a cap on the type and amount of one-time fees;
•Establish a small value amount for when dormancy fees, inactivity charges or fees, or service fee amounts may be assessed;
•Adopt a broad definition of "activity" for purposes of measuring when a consumer's gift card has been used;
•Make it clear and understandable to consumers that gift card funds do not expire earlier than 5 years;
•Include nonreloadable general use prepaid cards

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