Law May Reduce Credit Card Ads at N.Y. Colleges
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ALBANY – Companies could be barred from aggressive advertising, marketing, and merchandising of credit cards on college campuses in New York, according to a law approved yesterday by Governor Pataki.
Aimed at the crushing debt incurred by many students, the law takes effect July 1.
Critics, however, say the bill does little to stem the growing $2 billion credit card debt federal officials estimate college students have amassed nationwide. The state law limits credit card marketing to newspapers and magazines or at a bank branch on campus, unless a campus administration creates a policy. Such a policy could allow, restrict, or ban current practices, including the hard-sell by credit card representatives at tables on campuses, leaflets included with campus store purchases, and junk mail. A policy also may continue to allow, restrict, or ban gifts offered for completing an application, according to the bill.
“It got weakened,” said Russ Haven of the New York Public Interest Research Group. “The early versions of the bill had prohibitions on aggressive kinds of marketing and the giveaways, and the final bill that passed requires both public and private colleges in New York state to have a plan, then suggests some measures. It’s a ‘may,’ rather than a ‘must.’ “
Campus administrations that would draw up the policy now get a cut from the credit card companies to allow the marketing on campus. The new law doesn’t prohibit the fee, although it’s called a “dangerous precedent.”
Banks are among the most powerful lobbyists in Albany. MBNA Corp. alone contributed $200,000 to the state’s Republican committee from 2001-2002. The governor’s senior adviser for counterterrorism, James Kallstrom, is the former FBI chief for New York City and is senior vice president of MBNA America.
Nine other states – Arkansas, California, Hawaii, Illinois, Louisiana, Missouri, New Mexico, Virginia, and West Virginia – have passed restrictions or required study of credit card solicitation on campuses this year, according to the National Conference of State Legislatures.
