FOR IMMEDIATE RELEASE                             

CONTACT: John Carey at 202-466-1854
john@ourfinancialsecurity.org          

AFR Statement on CFPB Inquiry into Overdraft Practices

Washington, DC– Americans for Financial Reform, a coalition of more than 250 national and state organizations working together for strong Wall Street reform, issued the following statement today:

AFR welcomes the Consumer Financial Protection Bureau’s newly announced inquiry into overdraft fees, their impact on consumers, and in particular the Bureau’s focus on check re-ordering, and misleading or confusing marketing of so-called “standard” overdraft protection, a product deemed so abusive that regulators now require a consumer’s affirmative consent or “opt-in”.

In 2008, banks charged their own customers $23.7 billion in overdraft fees on only $21.3 billion worth of purchases. To put this number in context, $23.7 billion was more than all Americans spent on fresh vegetables that year. And check reordering – banks placing the largest withdrawal first, regardless of the actual order of charges, in order to maximize the number of overdraft fees – was a major source of that revenue. The CFPB’s inquiry indicates an appropriate concern about the damaging effects these fees can have on consumers; we hope and expect the data collection and analysis will swiftly lead to further steps to make this market fairer.

###