The free T-shirt opportunities will soon be gone from in front of the UCen as part of a recently approved California law that the state assembly hopes will also take out credit cards with 22 percent interest rates.
California Governor Gray Davis signed a bill September 12 to require the University of California Board of Regents, along with state and community college administrators, to adopt policies to combat the aggressive marketing tactics of credit card companies and prohibit the distribution of free materials.
The bill also recommends that university governing boards create debt-education programs, which will become a part of campus orientation programs.
UCSB has already set up restrictive guidelines that meet the requirements set out by this new bill, Bookstore Administrative Assistant Deborah Baker said.
“As of September 1999, the bookstore management of the vendor row has required the same restrictions on its vendors that were laid out in this new bill,” she said. “Yet some of the contracts with the vendors provided them with exemption from the new policies.”
This included the marketing company Marketsource, which solicits credit cards and other items on vendor row, Baker said. Marketsource’s contract expires this month and they will no longer be exempt from the new vendor program which, Baker said, places more restrictions on their activities.
“Aside from having to pay a fee of $500 per day, [Marketsource] will also be prohibited from handing out gifts in exchange for applications,” she said.
The bill was first introduced by California State Assemblymember Paul Koretz and was suggested by a graduate student intern at the assemblymember’s office, Koretz’s chief of staff Scott Svonkin said. Svonkin learned from the intern, who had been struggling with a credit card debt he had incurred from a student card, about others students who had been schemed.
“What we learned was that most students don’t get credit cards because they need them, rather that they applied for the cards in order to receive a free T-shirt,” Svonkin said. “The goal of the bill is to empower students to make informed decisions and realize that there are better places to get the cards.”
A study conducted by Public Interest Resource Groups on campuses nationwide found that, of the one third of students who have applied for credit cards at tables, 80 percent cite free gifts as the reason for applying.
According to the study, credit card solicitors would use methods to confuse students about the conditions of application leading to an increase of student application. Solicitors would fail to disclose non-introductory- and penalty-APRs which average at 22.84 percent, eight percentage points above the average non-penalty APR.
The bill was signed, in part, to encourage a theme of preventing manipulative marketing, the governor’s Spokesperson Roger Salazar said.
“Since the credit card companies prey on people who are not aware of the consequences of incurring a debt with these cards, students need to fully understand their rights and responsibilities,” Salazar said. “The governor is committed to consumer protection and he insures the public that we need to stop the predatory lending that gets students stuck in never-ending cycles of debt payment.”
A new website has been created by PIRG to provide consumers with facts and resources about debt education at .