FOR IMMEDIATE RELEASE: March 13, 2025
CONTACT: Carter Dougherty, carter@ourfinancialsecurity.org
Trump Administration Joins Big Banks to Roll Back Protection on Junk Fees
Announces plans to help Wall Street lift caps on credit card late charges
WASHINGTON, D.C. – The Trump administration has joined a group of big banks in an effort to destroy a vital safeguard against credit card junk fees that would have saved consumers $10 billion per year.
“The big Wall Street banks had been leading the charge against lower credit card late fees and now Trump appointees have joined them in trying to destroy this valuable consumer protection,” said Christine Chen Zinner, consumer policy counsel at Americans for Financial Reform. “Trump-appointed judges were already at work trying to make life more expensive for everyone who has a credit card. Now the Trump administration owns this move as well.”
Instead of defending a CFPB measure that would lower late fees, the Trump-appointed CFPB leadership today requested a pause in a lawsuit previously filed by the big banks and the U.S. Chamber of Commerce. The administration also signaled that they are working to meet the demands of the banks and that it is “optimistic that an agreement can be reached.”
As documented by AFR’s Wall Street Ripoff Counter, every day this CFPB rule is not in place, credit card users lose $2.7 million. To date, the bank lawsuit and now the Trump administration actions have cost consumers over $8.3 billion.
In March 2024, the CFPB banned excessive late fees on credit card bills, bringing down the average late fee to cardholders from $32 to $8. The move, which closed a longstanding loophole in bank regulations that had allowed banks to inflate the fees far beyond what late payments cost the banks, would have saved people $10 billion each year.
But big Wall Street banks and the U.S. Chamber of Commerce filed a lawsuit with the most right-wing regional court in the United States, the Fifth Circuit, covering Texas, Louisiana, and Oklahoma. Known for many pro-industry rulings, it is a favorable forum that banks have used to circumvent regulation. And the Fifth Circuit obliged them by suspending the rule on May 14, 2024.
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