Washington, DC – As of yesterday, banks and credit unions can no longer automatically charge debit card or ATM overdraft fees averaging $34 a piece.  But if their deceptive marketing efforts can convince you to check a box or “sign on the dotted line,” they can continue to gouge customers just as before.

Americans for Financial Reform believes further protections are needed, which is why the new Consumer Financial Protection Bureau cannot take over the job of protecting consumers soon enough.

Just take a look at what the current regulators have let the banks get away with in the wake of the rule change – sending out letter after letter with the deceptive message: “your card won’t work anymore,” as well as running ads and making phone calls attempting to mislead customers into signing up for continued overdraft “protection.”

The Federal Reserve and current bank regulators should have never let things get so bad that they needed this rule and, when they finally wrote it, they should have done more to protect consumers. The rules do not eliminate or cap repeated overdrafts for consumers who do sign up by opting-in to the programs. The rules still allow overdraft fees for all consumers caused by checks or recurring automatic debits from checking accounts. Finally, the rules do not ban check re-ordering. Last week a U.S. judge ordered Wells Fargo to pay customers over $200 million because check re-ordering to gain more overdraft income was unfair. Wells had been acting with the encouragement of its regulator, the Office of the Comptroller of the Currency (OCC).

Ed Mierzwinski, U.S PIRG: “For too long, bank regulators like the Federal Reserve and OCC aided banks in their successful efforts to gouge customers for a $34 fee when they swiped their cards for something as small as a $4 latte. For this reason, it’s even more critical that we will soon have a consumer protector in place with the sole duty of ensuring that all financial products — whether offered by a small bank, a big bank, or a non-bank — are responsible and fair. The Consumer Financial Protection Bureau will be able to step in when consumers are being cheated out of their hard earned money.”