CFPB, Federal Agencies, State Agencies, and Attorneys General
On July 28, the U.S. House Committee on Financial Services passed H.R. 4277, the Overdraft Protection Act. Introduced by Congresswoman Carolyn B. Maloney (D-NY), the bill would prohibit financial institutions from engaging in unfair or deceptive acts or practices in connection with overdraft coverage.
Specifically, the bill would require financial institutions that offer overdraft…
A Delaware federal court has refused to dismiss a class action complaint filed against a credit union that alleges the credit union violated Regulation E and the Delaware Consumer Fraud Act (CFA) even though the credit union’s overdraft opt-in notice tracked the language in the Regulation E model notice. The decision should serve as a…
Overdraft and NSF fees remain very much on the radar of the CFPB, the federal banking agencies, and certain state banking agencies. The very fact that the CFPB continues to closely monitor bank call reports with respect to overdraft and NSF fee revenues demonstrates the Bureau’s ongoing focus on this issue. While we do not…
The New York State Department of Financial Services (DFS) has issued an Industry Letter providing guidance on overdraft and non-sufficient funds (NSF) fees to depository institutions that it supervises.
The DFS indicates that, through the supervisory process, it has identified several unfair or deceptive acts or practices regarding the imposition of overdraft and NSF fees. …
In a blog post published last week, the CFPB reported that since the beginning of 2022, it has been collecting data from supervised institutions on their overdraft and non-sufficient fund (NSF) practices and intends to use the information to identify institutions for further examination and review. The CFPB also plans to provide feedback…
Last week, the Senate Banking Committee’s Subcommittee on Financial Institutions and Consumer Protection held a hearing entitled “Examining Overdraft Fees and Their Effects on Working Families.” A recording of the hearing is available here.
After opening statements from Subcommittee Chairman Raphael Warnock (D-GA) and Ranking Member Thom Tillis (R-NC), three witnesses offered testimony and…
A divided panel of the U.S. Court of Appeals for the Tenth Circuit has ruled in Walker v. BOKF, National Association that the extended overdraft fees charged by BOKF were not “interest” under the National Bank Act (NBA). The Tenth Circuit’s ruling on what it called “an issue of first impression in this circuit” follows…
Tomorrow, March 30, the House Financial Services Committee will hold a hearing, “The End of Overdraft Fees? Examining the Movement to Eliminate the Fees Costing Consumers Billions.”
The Committee memorandum references two pending bills dealing with overdrafts. One bill is H.R. 4277, the “Overdraft Protection Act of 2021,” which would limit the number…
The CFPB has published a table that shows the overdraft/NSF practices of the 20 banks with the most overdraft/NSF revenue through the first three quarters of 2021. According to the CFPB, the table reflects over 80% of the total overdraft/NSF fees earned by banks with assets over $1 billion. The information in the table is…
In the last two weeks, both the CFPB and OCC have been critical of bank overdraft practices and the CFPB has warned of enhanced supervisory and enforcement scrutiny. The potential costly impact that such increased scrutiny could have on private litigation is demonstrated by the recent proposed settlement in Lowe v. NBT Bank, N.A.,…
