Government Investigates Bank Overdraft Fees

According to WNYC news, the Consumer Financial Protection Bureau is looking to overhaul the way banks charge consumers overdraft fees. The agency will conduct research to find out how fees are calculated and the standards used for implementing them. This data will then be used to revamp the rules on such penalties. It is proposed that banks made over $15 million dollars last year in overdraft charges alone. According to CFPB director Richard Cordray, the majority of charges come from a very small minority of banking customers, in particular young checking account owners, and low income earners who are less likely to be able to afford paying back such charges.

Last year, a Federal Reserve rule was enacted to require customers to sign up for programs that charge overdraft fees. As a result, the number of overdraft fees have declined. Despite this, banks are finding new ways to recoup and make money from charging consumers various other fees for transactions.

Do you think banks have gone overboard with charging fees to customers?