In Russia, penalties for presenting the total cost of a loan (FLC) inaccurately in advertising for banking products may be doubled. A draft law will be discussed by the Legislative Activities Committee on Monday, February 5. The city newspaper refers to documents from the CPA and to a cabinet source for this information.
Reports indicate that the document was prepared by the Ministry of Justice and has already received endorsements from the Ministry of Finance, the Ministry of Economy, and the Federal Antimonopoly Service.
The proposed rule would require the disclosure of the PSC range whenever an advertisement mentions a loan interest rate. If the bill passes, penalties for wrongly stating the PSC in loan advertisements could rise from 40,000 rubles to 100,000 rubles for officials, and from 600,000 rubles to 1.6 million rubles for banks.
Currently, penalties for inaccurate data on the full cost of a loan in banking product advertisements range from 20,000 to 50,000 rubles for officials, and from 300,000 to 800,000 rubles for legal entities.
Previously, banks and microfinance organizations in Russia were required to show not only the minimum but also the maximum rate in loan advertisements.
Russian citizens have also been cautioned about the risk of accumulating debt, even with an unused credit card.