Regulators
HIGHLIGHT
A rule issued by Federal Reserve Board that took effect in 2010 requires that banks get explicit permission from their customers before enrolling them in high-cost overdraft systems that cover debits and ATM transactions. They received thousands of comments from consumers asking for the stronger of two proposed rules, which is a step in the right direction, but fails to address abuses in systems when customers do opt in. The FDIC has addressed one of the most egregious practices, re-ordering transactions from highest to lowest in order to charge more overdraft fees, but its guidance applies only to the state-chartered banks it regulates. The OCC and the Fed should stop re-ordering as well, and all bank regulators should take steps to keep financial institutions from assessing unfair and excessive overdraft fees.
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- Comments to CFPB on Overdraft Practices
July 6, 2012CRL joined with CFA and NCLC to provide the CFPB (Consumer Financial Protection Bureau) with documentation of bank overdraft practices and their impact on consumers. The CFPB should stop banks from reordering transactions and should prohibit overdraft fees on debit card transactions, which can easily be declined at no cost.
- Comment to the Federal Reserve on Notice by Capital One to Acquire ING Bank
September 20, 2011The Center for Responsible Lending commented on Capital One's proposed acquisistion of ING Bank at a public meeting held by Federal Reserve on September 20, 2011.
- AFR Sign-on to OCC on Overdraft and Bank Payday
August 9, 2011Consumer groups fear OCC proposed guidance may legitimize and facilitate the spread of payday lending by national banks, and banks would continue abusive overdraft practices—harming bank customers, undermining state payday loan laws, and weakening the long-term safety and soundness of financial institutions.
- Comments to OCC on Overdraft and Bank Payday Loans
August 9, 2011CRL filed comments to the OCC on August 8, 2011 urging them to strengthen rules on overdraft and bank payday lending. Automatic debit overdrafts, re-ordering of account transactions and direct deposit personal loans or bank payday loans unfairly strip fees from consumers.
- Overdraft Opt-In Savings
June 23, 2011Better Overdraft Policies Put Money Back In Consumers' Pockets: Regulators Must Stop Remaining Overdraft Abuses
