Research & Analysis
In addition to CRL’s extensive research documenting unfair overdraft practices, the FDIC and the Government Accountability Office have both produced reports outlining the abuses. CRL’s latest estimate of the overall cost of unauthorized overdrafts to Americans every year is $23.7 billion. We have also found that debit overdrafts cost $2 for every dollar “borrowed” from the bank to cover them.
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- Support HR 1456
March 12, 2009
On March 12, 2009, Representative Carolyn Maloney, Chairwoman of the Financial Institutions Subcommittee (D-NY), and Representatives Ackerman, Miller of North Carolina, Ellison, Speier, Tierney, and Eshoo introduced legislation to protect consumers from abusive overdraft loan programs and stop financial institutions from deliberately manipulating their systems to generate more overdrafts—while preserving the institutions' ability to cover occasional overdrafts as a courtesy without triggering the Act's requirements. The Act would: Amend the Truth in Lending Act to clarify that overdraft fees are finance charges, so that annual interest rates are reported. Consumers would then be able to compare the cost of overdraft loans with the cost of other credit options. Require written consent before enrollment in the overdraft loan program. Require financial institutions to warn the customer when an ATM withdrawal will trigger a fee—and allow the customer to cancel the transaction at that time. Prohibit financial institutions from manipulating the order of check clearing to increase customers' overdraft loan fees.
- Payday Loans Put Families in the Red
February 20, 2009
Explains how payday lending does not help borrowers avoid overdraft fees in spite of industry claims.
- Comment: Proposed Rule Regarding Unfair or Deceptive Acts or Practices – Overdraft Practices
August 4, 2008
Overdraft comment letter
- Comments on proposed Regulation DD amendments re Overdraft Lending
July 18, 2008
America, Consumers Union, and the National Consumer Law Center, provide the following comments regarding the Federal Reserve Board’s proposed rule to amend Regulation DD pursuant to the Truth in Savings Act (TISA).
- Shredded Security
June 18, 2008
Report on the impact of unauthorized overdraft fees on older Americans.
- Require opt-in for overdraft
June 13, 2008
CRL discusses importance of requiring banks to get explicit permission from customers before enrolling them in high-cost overdraft.
- Consumers Want Informed Choice on Overdraft Fees and Banking Options
April 16, 2008
A CRL survey finds respondents prefer that their bank or credit union deny debit card purchases that are not covered by the funds in their checking account, whether their purchase is for $5, $20 or $40.
- Overdraft Loans Trap Borrowers in Debt
March 18, 2008
CRL brief explains how overdraft loans trap account holders in high-cost debt to their banks.
- Comment: Implementation of Military Lending Amendment
February 26, 2008
Comments on Implementation of Limitations on Terms of Consumer Credit Extended to Service Members and Dependents
- Banks in California cannot deduct overdraft fees from Social Security benefits
December 14, 2007
CRL's amicus briefs in support of the plaintiff class in Miller v. Bank of America. CRL argues that California law concerning banks' set-off powers forbid banks from deducting overdraft fees from public benefit payments, including Social Security benefits, and this law is not preempted by the National Bank Act or regulations issued by the Office of Comptroller of the Currency. The trial court entered a verdict in favor of the plaintiff class; CRL participated in this case before the California Court of Appeals, First Appellate Division, and the California Supreme Court.