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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- Comment: Proposed FDIC Survey of Overdraft Loan Programs
October 16, 2006
Proposed FDIC Survey of Overdraft Loan Programs
- Require TILA Disclosures For Overdraft Loans
June 14, 2004
CRL ask the FED to put overdraft loans under the Truth in Lending Act under the grounds that they are an extension of credit.