PHOENIX Ariz. (KVOA) - Attorney General Mayes is taking a stand against high overdraft fees, joining forces with 22 other attorneys general. They have urged the U.S. House of Representatives to oppose a resolution that would overturn a Consumer Financial Protection Bureau rule designed to limit these fees.
"These fees often hit Arizonans at the worst possible time," Mayes said. "The CFPB’s rule is a critical safeguard to ensure that financial institutions treat their customers fairly."
The CFPB's 2024 rule targets banks with over $10 billion in assets, imposing limits on overdraft fees. However, the Senate recently passed a resolution to overturn this rule. The average overdraft fee is about $35, far exceeding the actual overdraft amount, contributing significantly to bank profits.
The letter highlights that if banks wish to continue profiting from overdraft fees, they must treat them as interest, given that they often translate to exorbitant annual rates. The CFPB's rule is seen as vital in protecting customers from unexpected charges that can harm their credit and even lead to account closures.
Attorney General Mayes emphasizes that many banks like Citigroup and Capital One have already eliminated overdraft fees, proving that such charges are unnecessary. The coalition includes attorneys general from states like California, New York, and Illinois, as well as the District of Columbia.
