NCJ Number
53730
Date Published
1979
Length
25 pages
Annotation
FINDINGS OF THE 1977 CONSUMER AWARENESS SURVEY, DATA SUPPORTING THE NEED FOR TRUTH IN LENDING SIMPLIFICATION, AND EVALUATIONS OF THE EFFECTIVENESS OF THE FAIR CREDIT BILLING ACT ARE DISCUSSED.
Abstract
A 1977 CONSUMER AWARENESS SURVEY BASED ON INTERVIEWS WITH A NATIONWIDE SAMPLE OF 2,563 CONSUMERS PROVIDED INFORMATION ABOUT CONSUMERS' RECOGNITION, COMPREHENSION, ATTITUDES, AND BEHAVIOR REGARDING THE REGULATION OF CREDIT USE. SUBSTANTIAL INCREASES IN THE AWARENESS OF ANNUAL PERCENTAGE RATES BY CONSUMERS DURING THE FIRST 15 MONTHS AFTER THE TRUTH IN LENDING ACT BECAME EFFECTIVE WERE INDICATED. SIMPLIFICATION OF DISCLOSURE STATEMENTS AND THE HIGHLIGHTING OF CREDIT RATE WERE NOTED BY RESPONDENTS; THE OVERWHELMING MAJORITY OF RESPONDENTS WERE UNFAMILIAR WITH FEDERAL LEGISLATION AND REGULATION OF CREDIT CARD BILLING ERRORS. IN 1977, EIGHT LARGE CREDITORS WERE SURVEYED TO DETERMINE THE EXTENT TO WHICH CONSUMERS EXERCISE CERTAIN RIGHTS UNDER THE FAIR CREDIT BILLING ACT. FINDINGS INDICATE THAT A SUBSTANTIAL NUMBER OF CREDIT CUSTOMERS QUESTIONED THEIR BILLING STATEMENTS EACH MONTH. IN AN EFFORT TO MAKE THE TRUTH IN LENDING DISCLOSURES MORE MEANINGFUL TO CONSUMERS AND EASE THE BURDEN OF COMPLIANCE ON CREDITORS, THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM PROPOSED IN 1977 TO THE SENATE COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS A SIMPLIFIED VERSION OF THE TRUTH IN LENDING ACT THAT WOULD PROVIDE FOR DISCLOSURE OF ONLY THE MOST IMPORTANT CREDIT TERMS. DURING THE PAST YEAR, THE FEDERAL RESERVE SYSTEM AND OTHER FEDERAL ENFORCEMENT AGENCIES CONTINUED TO PROMOTE COMPLIANCE WITH THE ACT AND REGULATION THROUGH A VARIETY OF METHODS, INCLUDING SPECIALIZED EXAMINATIONS CONDUCTED BY PERSONS EXTENSIVELY TRAINED IN CONSUMER LAW AND REGULATIONS. LEGISLATIVE RECOMMENDATIONS, ACTIVITIES OF THE CONSUMER ADVISORY COUNCIL, AND ADMINISTRATIVE FUNCTIONS FOR ENFORCING THE ACT ARE ALSO CONSIDERED. TABULAR DATA FROM THE CONSUMER AWARENESS SURVEY ARE PROVIDED. (RCB)