President Biden Delivers Remarks Announcing New Actions to Protect Consumers from Hidden Junk Fees

President Biden delivers remarks announcing new actions to protect consumers from hidden junk fees and put more money back in the pockets of hardworking Americans.

The White House

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Today, the Biden-Harris Administration is announcing bold, new actions to crack down on junk fees and promote competition:

The FTC is proposing a rule that, if finalized as proposed, would ban businesses from charging hidden and misleading fees and require them to show the full price up front. The rule would also require companies disclose up front whether fees are refundable. This would mean no more surprise resort fees at check out or unexpected service fees to buy a live event ticket. The rule would apply to industries across the economy, including event tickets, hotels and lodging, apartment rentals, car rentals, and more. Under the proposed rule, companies that fail to comply could face monetary penalties and have to provide refunds to consumers.

The CFPB is taking action to require large banks and credit unions to provide basic information to consumers without charging fees—meaning no more fees for basic services like checking bank account balances, obtaining a payoff amount for a loan, or getting account information needed for applications.

Later this month, the CFPB will propose a rule that, if finalized, would require financial companies to allow customers to safely, securely, and reliably send their banking transaction data to other companies and banks. The proposal would make it easier for people to break up with their bank, switch to banks with better offerings, and to manage accounts from multiple providers. This reform will ensure financial companies compete based on service quality and up-front pricing, deterring junk fees.

In addition, CFPB is releasing new findings showing their crack down on junk fees is already saving consumers billions of dollars:

- CFPB finds that bounced check fees are down more than 86 percent since 2021—saving consumers nearly $2 billion—and that nearly two-thirds of large banks have eliminated these fees entirely. Previous CFPB studies have shown that bounced check fees, which can cost $30-40 per transaction, hit low income and minority Americans the hardest. This new finding adds to the $5.5 billion annual reduction in banking junk fees achieved by the Biden-Harris Administration, for a total of an average of $170 in annual savings for the 33 million households that pay these fees.

- CFPB is also announcing that it secured an additional $140 million in consumer refunds from companies that charged illegal junk fees, such as surprise overdraft fees and multiple bounced check fees for the same transaction. Last October, the CFPB issued guidance to financial institutions about these illegal junk fees.