15 U.S.C. § 1666h — Offset of cardholder’s indebtedness by issuer of credit card with funds deposited with issuer by cardholder; remedies of creditors under State law not affected
submitted 52 years ago by Pub. L. 90-321 to r/title-15-COMMERCE-AND-TRADE · 293 words · no verdicts yet
A card issuer generally may not offset card debt against the cardholder’s deposit funds without prior written authorization, and must not do so for a disputed amount when the cardholder asks it not to. State-law attachment rights are unchanged.
(a) An issuer may not offset credit*-card debt against the cardholder’s funds on deposit with the issuer unless: (1) the cardholder* previously authorized it in writing under a plan allowing periodic deductions from the deposit account; and (2) the issuer does not take that action for an outstanding disputed amount when the cardholder asks it not to. For an account existing when this section took effect, the prior authorization was not required until renewal, and never later than one year after the effective date. Written authorization is considered to exist if the issuer previously warned that using the card would subject deposit funds to offset for unpaid amounts due under the agreement.
(b) This section does not change a card issuer’s State-law right to attach or levy on deposited funds if that remedy is constitutionally available generally to creditors.
A card issuer* may not take any action to offset a cardholder’s indebtedness arising in connection with a consumer credit* transaction under the relevant credit card* plan against funds of the cardholder* held on deposit with the card issuer unless—
such action was previously authorized in writing by the cardholder in accordance with a credit plan whereby the cardholder agrees periodically to pay debts incurred in his open end credit account by permitting the card issuer periodically to deduct all or a portion of such debt from the cardholder’s deposit account, and
such action with respect to any outstanding disputed amount not be taken by the card issuer upon request of the cardholder.
In the case of any credit card account in existence on the effective date of this section, the previous written authorization referred to in clause (1) shall not be required until the date (after such effective date) when such account is renewed, but in no case later than one year after such effective date. Such written authorization shall be deemed to exist if the card issuer has previously notified the cardholder that the use of his credit card account will subject any funds which the card issuer holds in deposit accounts of such cardholder to offset against any amounts due and payable on his credit card account which have not been paid in accordance with the terms of the agreement between the card issuer and the cardholder.
This section does not alter or affect the right under State law of a card issuer to attach or otherwise levy upon funds of a cardholder held on deposit with the card issuer if that remedy is constitutionally available to creditors generally.
Source credit: (Pub. L. 90–321, title I, § 169, as added Pub. L. 93–495, title III, § 306, Oct. 28, 1974, 88 Stat. 1515.)
- 1974Enacted · Pub. L. 90-321 · 88 Stat. 1515
A history note hasn’t been published yet. The record shows enactment by Pub. L. 90-321 on 1974-10-28.
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