Washington D.C. – Senate Banking Committee Republicans have issued a letter to Consumer Financial Protection Bureau Director Rohit Chopra demanding he “promptly rescind” the CFPB’s proposed rule cracking down on abusive credit card industry overdraft and late fees – an effort that is expected to save American families $9 billion every year. The Republicans’ correspondence — which offers an impassioned defense of ‘junk fees’ and their supposed “legitimate purposes” – comes as these committee members have taken over $2.2 million from banking trade groups and institutions that exploit such fees, an analysis from government watchdog Accountable.US found.
Last week, as several of the nation’s largest banks released their first 2023 quarterly earnings reports detailing high profits that “easily exceeded investor expectations,” Accountable.US released a new report finding the ten largest retail banks raked in a staggering $20.5 billion in revenue from ‘junk fees’ in 2022 – fees that disproportionately target struggling low-income Americans. Meanwhile, the CEOs of these 10 megabanks earned nearly $215 million in combined salary and compensation, averaging nearly $21.6 million.
Follow the money from big banks that abuse junk fees to see why Senate Banking Republicans would celebrate American families paying a $35 overdraft fee over a gallon of milk or loaf of bread. Only politicians deep in industry’s pocket could argue abusive junk fees are the cornerstone of a healthy economy. In reality, the practice leeches billions of dollars every year from the pockets of everyday Americans – padding banking industry profits and CEO bonuses while holding back the economy.
The megabanks that most frequently nickel and dime consumers with junk fees just reported tens of billions of dollars in increased profits – making clear the practice is based on corporate greed, not legitimate business need."