Credit Card Marketing Act of 2009

 The Credit Card Marketing Act of 2009 (P.A. 96-0261) regulates credit card marketing to students pursuing an undergraduate education at an institution of higher education. These students include anyone under the age of 21 admitted to or applying for admission to an institution of higher education, or enrolled on a full- or part-time basis in a course or program of academic, business, or vocational instruction where credits earned could be applied toward the earning of a bachelor's or associate's degree.

• The provisions set forth in the Act apply to any publicly or privately operated university, college, community college, junior college, business, technical or vocational school, or other educational institution offering degrees and instruction beyond the secondary school level.
  
  
• Furthermore, the Act applies not only to the institution, but also to its student groups, alumni associations, or affiliates.

The following is a summary of the provisions required under the Act.

Financial Education:

Any institution of higher education, including its affiliated entities, that enters into an agreement to market credit cards to students pursuing an undergraduate education must make a financial education program available to all students via posting on the institution’s web pages. The financial education program shall include, at a minimum:

1. An explanation of the consequences of not paying credit card balances in full within the time specified by the billing statement, including an explanation of the methods employed by credit card issuers to compute the interest on unpaid balances;
2. An explanation of common industry practices that have a negative impact on credit card holders;
3. Examples illustrating the length of time it will take to pay off various balances if only the minimum monthly payment is paid;
4. An explanation of credit-related terms, including but not limited to fixed rates, variable rates, introductory rates, balance transfers, grace periods, and annual fees;
5. Information on how to participate in the federal government’s opt-out program to limit credit card solicitations; and
6. An explanation of the impact and consequences that could result from using a debit card for purchases that exceed the deposits in the account.

Disclosure of Agreements with Credit Card Issuers:

Any institution of higher education, including its affiliated entities, that receives any funds or items of value from the distribution of applications for credit cards to undergraduate students must disclose agreements with credit card issuers. The disclosure applies only to agreements entered into after the January 1, 2010 effective date of the Act. The disclosure must include all of the following:

1. The name of the credit card issuer that has entered into the agreement with the institution of higher education;
2. The nature of the institution of higher education’s relationship with the credit card issuer, including the amount of funds or other items of value received from the agreement; and
3. The way in which those funds were expended during the previous school year.

The disclosure must appear in the following locations:

• On the webpage of the institution of higher education;
• An annual report to the Illinois Board of Higher Education ; and
• In any notices mailed to students marketing or promoting the credit card.

For public institutions of higher education, all agreements with credit card issuers shall be subject to disclosure pursuant to the Freedom of Information Act. Likewise, reports prepared by institutions of higher education documenting their relationship with credit card issuers, otherwise disclosed to the Illinois Board of Higher Education are subject to Freedom of Information Act request.

Gifts and Inducements:

No institution of higher education shall knowingly allow on its campus credit card marketing activity that involves the offer of gifts, coupons, or other tangible property (such as gift cards, t-shirts, and other giveaways) to undergraduate students where the ultimate goal is to induce a student to complete an application for a credit card.

Student Information Prohibited:

Institutions of higher education may not provide to a business organization or financial institution, for the purposes of marketing credit cards, information about undergraduate students under the age of 21. The following information is prohibited:

• Name,
• Address,
• Telephone number,
• Social security number,
• Email address, or
• Other personally identifying information.

Enforcement:

The Attorney General may bring any action in the name of the State against any institution of higher education to restrain and prevent any violation of this Act and seek penalties in amounts up to $1,000 per incident.