CRL shares stories of everyday people affected by financial abuse and emphasizes the need for the Consumer Financial Protection Agency to ensure that they and others are protected from such abuses in the future. The Dow closes at 10,000 points, putting it back to where it was a year ago when Lehman Brothers collapsed, and Wall Street rejoices. But the reality is the economic crisis that began in the destructive subprime mortgage market continues for American families. Key economic indicators show American families are still struggling: foreclosures at an all time high nationwide; the dollar at...
Excessive overdraft fees charged by banks and credit unions can cause devastation for financially vulnerable families. Many lenders used predatory policies and practices designed to repeatedly extract excessive fees from customers who could least afford them. Overdraft fees are a leading cause of financial institutions closing a consumer’s account and reentry into the banking system often is exceedingly difficult, increasing the financial insecurity of many consumers. CRL advocates for legislators and regulators to rein in the size and frequency of these fees. We estimate that the savings from these fee eliminations will be between $3 billion to $4 billion for working families.
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Banks and credit unions skim cash from accounts through unfair overdraft practices Rather than discouraging customers from overdrawing their accounts, the system most banks and credit unions now use creates additional overdrafts and maximizes the number of fees they can charge. CRL finds that bank fees for overdrafts increased 35 percent in two years, rising to nearly $24 billion per year in 2008. Customers are now typically automatically enrolled in overdraft systems that approve debit card transactions with no warning in the event of insufficient funds, so they frequently pay a $34 fee for...
CRL shares stories of everyday people affected by financial abuse and emphasizes the need for the Consumer Financial Protection Agency to ensure that they and others are protected from such abuses in the future. The Dow closes at 10,000 points, putting it back to where it was a year ago when Lehman Brothers collapsed, and Wall Street rejoices. But the reality is the economic crisis that began in the destructive subprime mortgage market continues for American families. Key economic indicators show American families are still struggling: foreclosures at an all time high nationwide; the dollar at...
October 20, 2009 Members, Financial Services Committee U.S. House of Representatives Washington, DC 20510 Dear Representative: As the Financial Services Committee prepares to continue its markup of H.R. 3126, we write to express our support for a strong, non-preemptive Consumer Financial Protection Agency (CFPA). In this regard, we call your attention to two issues that are expected to come up in today's markup. First, on maintaining the States' vital role, overly broad preemption in recent years contributed to the current financial crisis by removing state protections that deterred...
October 20, 2009 Members, Financial Services Committee U.S. House of Representatives Washington, DC 20510 Dear Representative: As the Financial Services Committee prepares to continue its markup of H.R. 3126, we write to express our support for a strong, non-preemptive Consumer Financial Protection Agency (CFPA). In this regard, we call your attention to two issues that are expected to come up in today's markup. First, on maintaining the States' vital role, overly broad preemption in recent years contributed to the current financial crisis by removing state protections that deterred...
Today's overdraft practices are designed to drive up the fee revenue of banks and credit unions and not to discourage customers from overdrawing their accounts. Our report shows that fees are climbing very quickly and affecting millions of Americans every year. Over 50 million Americans overdrew their checking account at least once over a 12 month period, with 27 million accountholders incurring five or more overdraft or non-sufficient funds (NSF) fees. Banks and credit unions collected nearly $24 billion in overdraft fees in 2008. Overdraft fee income for banks and credit unions rose 35...
How has your state fared in the financial crisis? These state-by-state fact sheets show some of the major costs of bad lending in recent years. They include delinquencies and foreclosures, the cost of bank overdraft loans and, where applicable, the cost of payday lending. We also include data showing the share of high-rate (subprime) mortgages made by national banks that were allowed to ignore state lending laws. United States Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky...
Read a condensed version of this report (PDF) Introduction For too long the responsibility for protecting consumers has been fragmented among various federal regulators whose primary focus was the safety and soundness of the banking system. Consumer protection often went neglected, if anything, an afterthought or a box to check. Federal regulators' failure to restrain abuses that led to today's credit crisis demonstrates the need for a single agency focused on protecting consumers to ensure financial institutions flourish in a sustainable way. To succeed in protecting consumers, this agency...
Consumer Financial Protection Agency (CFPA) In recent years, federal bank regulators looked the other way as tricky financial products with hidden costs and fees crowded out responsible loans. Dangerous products have stifled true innovation, depriving consumers of meaningful choices and leading the nation into today's financial crisis. We don't always need more regulation, but rather more effective regulation that is targeted and up-to-date. CRL is a member of Americans for Financial Reform , a coalition of nearly 200 national, state and local consumer, employee, investor, community and civil...
Consumer Financial Protection Agency (CFPA) In recent years, federal bank regulators looked the other way as tricky financial products with hidden costs and fees crowded out responsible loans. Dangerous products have stifled true innovation, depriving consumers of meaningful choices and leading the nation into today's financial crisis. We don't always need more regulation, but rather more effective regulation that is targeted and up-to-date. CRL is a member of Americans for Financial Reform , a coalition of nearly 200 national, state and local consumer, employee, investor, community and civil...