Banking and Finance Law Daily Wrap Up, CONSUMER FINANCIAL PROTECTION BUREAU—Consumer groups ask Harris, Trump campaigns to address junk fees, (Aug 15, 2024)
By Nora Macaluso
The groups said the Consumer Financial Protection Bureau’s work to stop junk fees is “immensely popular” and should be continued in a future administration.
Thirty-five consumer advocacy organizations jointly sent letters to the Kamala Harris and Donald Trump presidential campaigns asking that any future administration carry on the Consumer Financial Protection Bureau’s work to combat junk fees.
“As President Biden highlights the success of his crackdown on junk fees—especially credit card late fees—presidential candidates should promise to protect people from unfair, undisclosed fees,” said one of the groups, Americans for Financial Reform.
Junk fees, the groups said, are costly and hurt competition, consumers, workers, small businesses, and entrepreneurs, and “fighting them is immensely popular.”
The groups commended the CFPB for taking action on overdraft fees, non-sufficient funds fees, and credit-card late fees.
“To prevent consolidated power from imposing fees that extract economic value from families, junk fees must remain a part of any future economic agenda to lower costs for families,” said the groups, which included the Action Center on Race and the Economy, Consumer Action, and the National Consumer Law Center.
These “exploitative” fees “drain money and resources from households,” particularly hurting lower-wage workers and people of color, the letter said. “These kinds of fees can trap people in cycles of debt and limit access to banking, resulting in financial exclusion,” they said.
Junk fees can also hurt small businesses and “stifle entrepreneurship,” the letter said.
“The CFPB’s regulation of junk fees, a campaign that is overwhelmingly supported by the public, is crucial,” the groups said.
“These fees have a detrimental impact by pushing consumers out of mainstream financial products into fringe financial services and predatory financial products that are even more costly,” the letter said. “The prevalence of these fees across different products and markets underscores the pressing need for continuous and vigilant action.”
“Any future administration must prioritize an economic agenda to rectify and prevent financial harms caused by Wall Street banks, predatory lenders, and large corporations,” the groups said. “The CFPB, with its ongoing commitment to uncovering and addressing junk fees, is a key player in this effort.”
“This coalition of consumer and financial justice advocates is fully prepared to support and welcome an economic justice agenda that prioritizes the financial stability of consumers and households,” the letter concluded. “This readiness underscores the widespread support for these reforms and the collective determination to achieve financial stability.”
Companies: Action Center on Race and the Economy; Americans for Financial Reform; Arkansas Community Organizations; CAMEO Network; CFA; Consumer Action; Economic Action Maryland; Economic Empowerment Center, d/b/a Lending Link; Demand Progress; Faith in Action; Georgia Watch; Jewish Women International; Legal Aid Center of Southern Nevada; Make the Road Nevada; National Association of Consumer Advocates; National Association for Latino Community Asset Builders; National Consumer Law Center; National Consumers League; National Disability Institute; NELP Action; Northern Nevada Legal Aid National Community Reinvestment Coalition; Oregon Consumer League; Progressive Change Institute; Progressive Leadership Alliance of Nevada Action Fund; Public Justice; Public Justice Center; RAISE Texas; Rise Economy; 20/20 Vision; Virginia Citizens Consumer Council; Woodstock Institute
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