Consumer Bureau Targets Checking Overdraft Fees

Chicago Tribune
September 19, 2011

A controversial new federal agency is targeting a consumer pariah: checking account overdraft fees. The de facto head of the Consumer Financial Protection Bureau, Raj Date, said in a speech in Philadelphia in mid-September that the new regulator is going to begin scrutinizing overdraft programs with the goal of clarifying the cost of free checking accounts. "With these free checking accounts, much of the costs to the consumer were buried in overdraft fees," said Date, special adviser to the Treasury Secretary on the consumer bureau. "Going forward, the bureau will carefully assess how we can best ensure that the overall market for short-term credit is fair, transparent, and competitive." Date -- who is running the consumer bureau as it anticipates the confirmation of its first chairman -- said that one of the CFPB's first major decisions could be establishing guidelines for banks to make sure consumers understand what they are doing when they accumulate overdraft fees.
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