WASHINGTON, DC — A stunning new report from the Consumer Financial Protection Bureau found that in 2022 alone, credit card companies charged consumers more than $105 billion in interest and more than $25 billion in fees – propelling total outstanding credit card debt past $1 trillion for the first time since this data has been collected. This includes $14.5 billion in late fees, which “continued to be the most significant fee assessed to cardholders in both dollar amount and frequency.” The findings come amid the CFPB’s proposed rule that seeks to cap most credit card late fees at $8 down from an average of $30, saving Americans up to $9 billion annually – a hugely popular effort opposed by key members of the MAGA House Majority in the pocket of big banks.
As government watchdog Accountable.US has documented, Republican Chair of the House Financial Services Committee Patrick McHenry and his top lieutenants have vigorously defended the practice of excessive overdraft and late penalties after taking millions of dollars from the same industries that abuse them. While McHenry and fellow committee members Andy Barr and Blaine “Junk Fees Don’t Exist” Luetkemeyer have gone to the mat in defense of greedy and abusive junk fee practices, the CFPB’s efforts are already delivering for everyday Americans: Bounced check fees are down more than 86% since 2021—saving consumers nearly $2 billion; banking fees are down more than $5 billion annually compared to pre-pandemic; and the CFPB has already secured $140 million in consumer refunds from companies that charged illegal junk fees, like surprise overdraft fees.
Credit card debt has reached levels never seen before thanks to billions of dollars in abusive junk fees, yet Republicans in Congress like Rep. Patrick McHenry only see dollar signs for their big bank contributors.
After cashing checks from corporations notorious for junk fees, McHenry claims the practice somehow does consumers a favor by separating them from billions in hard-earned money every year. Lawmakers bought and paid for by credit card companies claim a $35 overdraft fee on a gallon of milk or loaf of bread teaches Americans financial responsibility even though the excessive penalties are often buried in the fine print. Those in Congress that defend the status quo of record high credit card interest and fees should at least be honest about why they shill for the financial industry at the expense of everyday families.”
Accountable.US’ Liz Zelnick, the group behind the Defend American Consumers campaign.
MORE FROM ACCOUNTABLE.US:
- Anti-CFPB Rep. Andy Barr Admits Congress Already Controls CFPB’s Funding
- Junk Fee-Abusing Industries Already Spent $1.7M Lobbying Against ‘Junk Fee Prevention Act’
- What the Financial Industry Doesn’t Want You to Know About Their Abusive Junk Fees.
- Analysis: Financial Industry’s Rhetoric On Credit Card Junk Fees Distorts Costly Reality For Consumers