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Credit card companies that deploy irresponsible and misleading tactics to sign up college-age consumers as cardholders should be reined in with legislation, said witnesses at a hearing held yesterday by the House Financial Services Subcommittee on Financial Institutions and Consumer Credit. At the hearing, chaired by Rep. Carolyn Maloney, D-N.Y., college-campus advocates and experts on educational policy testified that college students often are exploited by credit card companies that blanket them with solicitations, luring them with freebies to sign up for credit cards they are ill-equipped to manage. Brett Thurman, a University of Illinois student government leader, testified that while credit cards are useful tools for many students, some card companies do not adequately explain the rates and terms when marketing cards to college-age consumers on and near campuses. Christine Lindstrom, higher education project director for the U.S. Public Interest Research Group, testified that the nonprofit organization's research shows eight out of 10 college students report receiving mailed credit card offers, often through marketing agreements sanctioned by college administrators. Lawmakers and student advocates vowed support for legislation that would require cardholders to apply stricter underwriting standards to college-age consumers and ban the marketing of credit cards to college students unless they sign an opt-in agreement. Kenneth J. Clayton, senior vice president and general counsel of the American Bankers Association Card Policy Council, testified that although there are many examples of student credit card misuse, the vast majority of college-age consumers have credit cards and manage them responsibly. "We hope policymakers will be mindful to not create artificial barriers to the exercise of these independent choices, recognizing that in creating such barriers you may be limiting the significant benefits that credit products have to offer for the vast majority of young adults," Clayton said.

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