Abusive credit card practices were criticized on Tuesday by a U.S. senator who has introduced legislation prohibiting lenders from making claims on consumers in bankruptcy if interest rates are excessive.

Senator Sheldon Whitehouse, a Rhode Island Democrat, told a hearing on credit card practices that Americans are relying more than ever on credit cards to make ends meet and banks are trying to squeeze as much profit as possible from cardholders.

The standard credit-card agreement gives the lender the power to bleed their customers through evolving and ever more crafty tricks and traps, said Whitehouse, who chairs the Senate's subcommittee on administrative oversight and courts.

Whitehouse in January introduced legislation aimed at giving consumers seeking bankruptcy protection the ability to negotiate terms with lenders.

His Consumer Credit Fairness Act would also prohibit lenders from making claims in bankruptcy if interest rate thresholds are exceeded.

The bill would set the base rate at 15 percent plus the current yield on the 30-year Treasury bond. The rate would include all penalty fees and charges, in a step aimed at preventing lenders from applying back-door rates.

In addition to credit cards, the bill also targets payday loans, auto loans, overdrafts and layaway plans.

It would also exempt consumers from being required to take a means test to qualify for bankruptcy protection, a provision that was included in the landmark 2005 bankruptcy law that critics charge was too generous to lenders.

The top Republican on the subcommittee also criticized credit card companies but urged caution on capping interest rates.

They are a cold-blooded bunch out to make a profit, Jeff Sessions, a Republican from Alabama, said of the credit card companies. But I'm not comfortable about capping interest rates.

As more Americans lose their jobs and homes, credit card practices have become a central focus in Congress as lawmakers draft a broad plan to revamp the regulation of financial institutions partially blamed for causing the current crisis.

The House of Representatives Financial Services Committee is expected to consider a credit card bill as soon as next week.

(Reporting by John Poirier; Editing by Tim Dobbyn)