Skip to Content

Get Your FREE Consultation


Federal Legislation Proposed to Curb Overdraft Fee Abuses

February 18, 2010

Americans pay $23.7 billion per year in overdraft fees, most of which are related to small debit card overdrafts that financial institutions could easily deny without imposing any fees. As the Center for Responsible Lending has noted: “These fees hit vulnerable consumers hardest, thrusting them into a cycle of debt and driving some from the banking system altogether.” The Federal Reserve Board issued rules in November 2009 which were intended to rein in bank overdraft practices. However, many consumer advocates and some members of Congress contend the Federal Reserve’s rules did not go far enough.

Legislation is currently pending before Congress which is intended to comprehensively address what are seen as continuing problems with bank overdraft programs. The pending legislation (H.R. 3904, S. 1799) would accomplish the following: (1) there would be a limit on the frequency of permissible overdraft charges to six per year and one per month; (2) overdraft fees would need be reasonable in amount and proportional to the bank’s actual cost; (3) there would be required real-time warning of a pending overdraft at all ATMs; (4) institutions would be prohibited from continuing to post purchases in order from largest to smallest so as to maximize overdraft fees; and (5) banks would be precluded from charging multiple overdraft fees for a single overdraft. The proposed legislation would also require a cost of credit disclosure for overdraft fees, consistent with the Truth in Lending Act (TILA), so consumers would have a basis upon which to compare the cost of overdraft fees to other, less expensive forms of credit.

No Win, No Fee

Review Us

Martin & Jones, PLLC logo

“Thank you for your concern of my well-being every time I spoke with you. It always meant so much. I hear nothing but awful stories of dealing with attorneys and their offices, but I have had nothing but positive experience. You have many special ways of working with people in need of help. Words can never express the way your support has been so helpful. I pray you will continue to help others. I wish you all the best.”

Contact Our North Carolina Personal Injury Law Firm

for a Consultation for Your Accident or Medical Malpractice Claim

Call us at 800-662-1234
No Win, No Fee

The law firm you choose makes a difference. If you are the victim of an accident or an illness that someone else caused, the North Carolina personal injury law firm of Martin & Jones has the depth of experience, skills and sensitivity to make your road to recovery as smooth as possible. Whether you have experience with the legal system or have never hired a medical malpractice or personal injury lawyer before, our attorneys and staff will do our best to answer your questions, provide clear advice and prepare you and your family for what to expect. If you would like more information or to meet with one of our attorneys, please fill out the form below or call us at 800.662.1234.