[Congressional Record Volume 148, Number 119 (Thursday, September 19, 2002)] [Extensions of Remarks] [Page E1625] From the Congressional Record Online through the Government Publishing Office [www.gpo.gov] H.R. 1701, THE CONSUMER RENTAL PURCHASE AGREEMENT ACT ______ HON. JAMES H. MALONEY of connecticut in the house of representatives Thursday, September 19, 2002 Mr. MALONEY of Connecticut. Mr. Speaker, I urge my colleagues to support the Consumer Rental Purchase Agreement Act, H.R. 1701. The bill before us is the product of the many months of hard work by several Members. I want to especially thank Congressman Walter Jones and my Financial Service Committee colleagues on both sides of the aisle for their constructive input in producing a bipartisan, consumer friendly piece of legislation. Let me make it clear, this bill establishes a federal floor for Rent- to-Own disclosures and consumer rights, and preserves states'options to regulate costs and other disclosures. That is, States can still apply further economic and substantive safeguards, such as regulating maximum rental costs, allowable fees, and fair collection practices should they decide to do so. In April of 2000, the Federal Trade Commission (FTC) issued a staff report that addresses many of the issues surrounding the rent-to-own industry. Generally speaking, the FTC report concluded that clear and comprehensive disclosures of the rental-purchase transaction would benefit both the industry and consumers. In that report, the FTC made some recommendations regarding the types of disclosure that would benefit consumers. The ``Consumer Rental Purchase Agreement Act'' is an effort to begin to implement those recommendations. I think that everyone will agree that giving consumers the information they need to make informed decisions is both good public policy and ultimately good economic policy as well. The consumer safeguards provided in this legislation include the prohibition of certain fees, improved consumer disclosures, expanded civil liability, prohibition of abusive practices, and the preservation of existing rights. H.R. 1701 requires several clear and conspicuous disclosures that assure merchants will not present information in such a way that conceals or misleads consumers as to the true cost of the transaction. The proposal includes a plain language requirement for use in contracts. Specifically, the bill requires that all merchandise bear a label or tag that discloses specific cost and merchandise information, such as the price to purchase the merchandise for cash, the rental payment amount, the total number of payments to acquire ownership, and the total cost of ownership. Additionally, H.R. 1701 requires that price tags and label disclosures (as well as contracts) include the total cost for ownership, which consists of the sum of all rental payments and any mandatory fees or charges, per the FTC report recommendation. The bill also requires that price tags and labels (and contracts) identify whether merchandise is new or used. The Consumer Rental Purchase Agreement Act also prohibits the imposition of any special fees to acquire ownership, including a prohibition on balloon payments. The bill prohibits merchants from charging more than one late fee for a delinquent rental payment, or charge for an unpaid late fee. This will ensure that consumers are not charged with unfair or over-burdensome penalties and fees for simply missing a payment. Importantly, H.R. 1701 clarifies civil liabilities protections for consumers in Rent to Own transactions. H.R. 1701 expands civil liability and penalties to allow actions based on a ``pattern or practice'' of advertising violations. The bill explicitly provides for civil action and expanded penalties for enforcement by the FTC and State attorneys general, based on a pattern or practice of violations by a merchant. Additionally, the bill ties criminal and civil liability and penalties for violations to the requirements of the Truth in Lending Act and Consumer Leasing Act. Mr. Speaker, this bill establishes an important federal floor for consumer protection, and create a framework for additional consumer protection in the future. In sum, this legislation will give consumers the information they need to make informed decisions. It will also create a uniform regulatory baseline that will help with the growth of the industry and its contributions to our economy. I urge my colleagues to support this far-sighted legislation. ____________________