Jhe Consumer Financial Protection Bureau on Wednesday announced plans to crack down on hidden fees charged by banks and financial institutions.
The CFPB has issued a request for information and is seeking public input on the fees it does not deem fair. It targets fees that are not included in the advertised price of a transaction, for example, when “resort fees” or “service fees” are charged after the fact.
“Many financial institutions hide the true price of their services by enticing customers with enticing offers and then charging excessive fees,” said CFPB Director Rohit Chopra. “By promoting competition and ridding the market of illegal practices, we hope to save Americans billions.”
The CFPB said it wanted to hear from the public about fees associated with its bank, credit union, prepaid account or credit card, mortgage, loan or payment transfers.
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The watchdog said it wanted information on charges for items people thought were covered by the base price of a product or service, unexpected charges for a product or service, charges that seemed too high for the purported service and charges for which it was not known why. the customer has been debited.
In addition to consumers, the CFPB seeks input from small business owners, nonprofit organizations, legal aid attorneys, academics and researchers, state and local government officials, and financial institutions, including including small banks and credit unions.
Financial institutions are already pushing back against the watchdog initiative. A group of eight trade groups, including the American Bankers Association, released a joint statement on Wednesday calling the request for information “misguided” and saying it paints a “distorted and misleading picture” of the financial services market.
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“Several federal laws and the CFPB’s own rules already require banks, credit unions and other consumer financial service providers to disclose terms and fees in a clear and visible manner, and our members do so every day,” the statement said. “Consumers in this country know they have a wide range of choices when it comes to financial services products, and these companies compete with each other every day, including on fees.”
The public comment period for the new initiative ends on March 31.