The University of Maryland Student Public Interest Research Group
had a message for students Thursday: "Don't be a sucker" when it comes
to credit cards.
“We’re telling students ways to stop all the junk mail, ways they can
go online to get free credit reports,” ways they can keep from being
duped into signing up for cards they don't need, said Chris Leutchen,
MaryPIRG campus advisor, as he and others handed out official brochures
and "don't be a sucker" lollipops at the Stamp Student Union.
"We're not against credit cards; we're against some of [the companies']
practices," he said. They include enticing students to sign up with
"freebie" gifts or coupons and not explaining that the forms they are
filling out activate credit card accounts, he said.
Rachel Levy, a junior public health major at Maryland, said that she
was “suckered” into getting a credit card last semester that she later
had to cancel.
“A
girl in the dorm was handing out free T-shirts,” Levy said. “A few
months later, I got all of this mail; I wish I’d never gotten it.”
Levy was one of several students handing out materials at the event.
They encouraged their peers to sign a petition to House Majority Leader
Steny Hoyer, a Maryland Democrat, calling for an end to "aggressive
marketing."
MaryPIRG is one of 39 student PIRG chapters educating students about credit cards on campuses across the country.
Ed Mierzwinski, consumer program director of the U.S. PIRG Education
Fund, said the campus campaign is the first step to pressuring credit
card companies to treat all consumers more fairly.
"We think colleges can be catalysts, change agents," Mierzwinski said
in a teleconference Wednesday morning. "The changes colleges make will
put pressure on companies to change their practices more broadly."
The U.S. PIRG Education fund also set up a Web site at
TruthAboutCredit.org. The site will be home to research projects over
the next 18 months, detailing the ills of marketing to young people.
Students "come to our campuses with very little financial
sophistication and savvy," said Becky Timmons, assistant director of
government affairs at the American Council on Education. "The
overwhelming changes they're experiencing at that time can make them
vulnerable to undertaking credit they may come to regret."
According to statistics on TruthAboutCredit.org, balances among
college-age consumers have increased by 134 percent in the last decade.
The average senior is graduating with around $4,000 in credit card
debt, the organization says.
Mierzwinski said communication in general between credit card companies
and consumers is a "David vs. Goliath experience." He added, "You'd
probably need a 38th grade education to understand" some of their
policies.
Visa, MasterCard and American Express do not issue cards on college campuses, spokesmen for the companies said.
Samuel Wang, a spokesman for Citigroup, said vendors who market
Citibank credit cards "are required to comply with all applicable laws,
including advertising laws, as well as university regulations and
industry guidelines."
Mark Scarborough, vice president of acquisitions at Discover Financial
Services, said in a statement that the company stopped marketing on or
near college campuses nearly a year ago. "We share the interests of
states, colleges and students to make sure students use their credit
wisely and develop good credit histories, and are committed to
providing the tools and tips to help them maintain good credit," the
statement said.
As part of its campaign, PIRG will go directly to university
administrators to urge them to set up contracts with credit card
companies, banning practices like marketing with free gifts or going
into semi-private places, like dormitories.
John Farley, assistant vice president for administrative affairs at
the University of Maryland, is sympathetic to restricting the range of
credit card companies on campus. "I understand the problem; I have two
college-age students myself," he said.
"If there's some way the university can put standards on or be more controlling of them, we should be."
Andrew Friedson, student body president at the University of Maryland, commended MaryPIRG for its educational efforts.
Students “might not realize everything that's going on with debt and
potential long-term ramifications that can come of bad credit and
debt,” he said.
