rssFed Tackles Overdraft Fees
Thursday, November 12, 2009 at 1:53 pm
- 12 Comments
Customers will have to opt-in to overdraft protection programs before banks can charge them overdraft fees on debit purchases and ATM withdrawals, according to new finance rules rolled out by the Federal Reserve today. The move marks a sharp departure from current practice, in which many banks silently and automatically enroll their customers into overdraft programs, and charge large fees for each overdraft purchase.
“The final overdraft rules represent an important step forward in consumer protection,” Fed Chairman Ben Bernanke said in a statement. “Both new and existing account holders will be able to make informed decisions about whether to sign up for an overdraft service.”
Threatened with congressional reform, some banks have already taken it upon themselves to operate more transparent overdraft protection programs. But the banking industry on the whole has opposed the idea, arguing that the overdraft protections benefit consumers by allowing them to make purchases even when accounts have run dry.
The industry has good reason to oppose the changes. Overdraft fees — which now top $30 apiece, on average — have evolved into a $38 billion-per-year money-making venture for the banks, according to Moebs Services, an Illinois-based financial research firm.
The Fed’s new rules take effect next summer.
Finance leaders in both chambers of Congress have introduced legislation to protect consumers from overdraft abuses. Aside from requiring customers to opt-in to the protection program, those bills also cap the number of overdraft fees allowed per year and prohibit banks from manipulating the chronology of purchases in order to maximize the number of overdraft fees — items the Fed’s new rules don’t address.
No word yet if the sponsors of those bills — Rep. Carolyn Maloney (D-N.Y.) and Sen. Chris Dodd (D-Conn.) — are satisfied with the Fed’s reforms or will keep pushing forward with their own, stronger consumer protections.
12 Comments
Pingback posted November 12, 2009 @ 1:55 pm
[...] This post was mentioned on Twitter by George Larson II, WashIndependent. WashIndependent said: Fed Tackles Overdraft Fees http://bit.ly/3H2YFx [...]
Pingback posted November 12, 2009 @ 3:15 pm
[...] Customers will have to opt-in to overdraft protection programs before banks can charge them overdraft fees on debit purchases and ATM withdrawals, according to new finance rules rolled out by the FederalReserve today. …Read Original Story: Fed Tackles Overdraft Fees – The Washington Independent [...]
Comment posted November 12, 2009 @ 5:44 pm
The Fed needs to be gutted and rebuilt. Our current banking industry is like a bull in a china shop leaving a wake of destruction (see: http://www.repofinder.com ). We encourage Americans to get in debt then kill the economy with greed and over regulation in the credit markets.
Comment posted December 11, 2009 @ 7:27 pm
The banks took the money and even as they repay it, it's going to be hard for them to get Congress out of their business. Their fees have passed crazy for some items, but it isn't like we don't have multiple banks, or credit unions for that matter.
Comment posted December 12, 2009 @ 9:07 am
Don't forget to include the importance of truth in advertising.
Comment posted December 12, 2009 @ 2:07 pm
Don't forget to include the importance of truth in advertising.
Comment posted September 3, 2011 @ 4:56 am
Does Your Friend Or Family have Night Terrors? Check this out!
Comment posted September 6, 2011 @ 1:05 pm
So I’ve been looking around the net and have come to the conclusion that it’s hard to find someone to do good
SEO Work! It just plain is! But I did stumble upon a gentlmen that really knows his stuff and got my site to a page
rank 3 in one month! He’s great! Check him out I think you will be suprised. Why am I sharing? Because This Forum
KICKS ASS!! Ha ha enough said! Try him out you won’t be dissapointed.
Comment posted September 6, 2011 @ 3:17 pm
Trying To Loose Weight and can’t? You gotta try this out it’s one of the easiest most Pain Free Ways To Loose Wieght There Is!
No Bull. I tried this and it worked Check out this……
Comment posted September 6, 2011 @ 3:23 pm
So I’ve been looking around the net and have come to the conclusion that it’s hard to find someone to do good
SEO Work! It just plain is! But I did stumble upon a gentlmen that really knows his stuff and got my site to a page
rank 3 in one month! He’s great! Check him out I think you will be suprised. Why am I sharing? Because This Forum
KICKS ASS!! Ha ha enough said! Try him out you won’t be dissapointed.
Comment posted September 6, 2011 @ 7:38 pm
Backlinks And SEO is a part of what everyone needs for their websites! It’s like the trade of the internet you need to have it and
it will always be there. You need to always have traffic coming in to your website and you need to have backlinking done just
as you need traffic. So why not get a cheap and reliable service that will do all of this for you? Check this out….
RSS feed for comments on this post.
Sorry, the comment form is closed at this time.
