House votes to speed up new credit card rules

(CBS/AP)  The House has voted to impose tough new rules for credit card companies unless lenders agree to freeze interest rates and fees.

The bill, approved 331-92, would accelerate the February enactment date of legislation already passed by Congress that limits when and how banks can charge credit card customers.

The bill would become effective when President Barack Obama signs it, but prospects of Senate passage are dim.

Last month, Rep. Barney Frank, who is working on Wall Street reforms, essentially warned banks to stop exploiting the time period before the new credit card rules' enactment to jack up rates on customers.

Last spring, Frank helped push a bill through Congress that imposes strict new rules on lenders, including a limitation on when and how banks hike rates. Most of the rules will take effect in mid-February, a date set by Congress to give banks time to prepare for the changes.

But the Massachusetts Democrat, who chairs the House Financial Services Committee, said at a that lenders have abused the grace period by using the time to hike rates ahead of the new rules.

"It is very clear that this is the kind of protection that shouldn't wait and we should move forward," Frank said about the new credit card rules.

In May, the Senate passed a major reform of the credit card industry, clamping down on arbitrary fee and interest rate increases.

But CBS News business correspondent Anthony Mason reported that the bill didn’t take effect for nine months, leaving a loophole for card issuers to exploit.