Biden announces new measures to cut unwanted fees

CNN
—

President Joe Biden On Wednesday, new efforts were revealed to eliminate this phenomenon Junk fees While he announced savings of $2 billion and $140 million in refunds to consumers from previous crackdowns on unwanted charges from the Consumer Financial Protection Bureau.

“People are tired of being used and manipulated,” Biden said during his remarks in the Rose Garden.

“Unfair fees known as junk fees – those hidden fees that companies sneak onto your bill to make you pay more because they can. Simply because they can. Charges that take real money out of the pockets of American families. These unwanted fees can add up to hundreds Dollars weigh on family budgets, making it more difficult to pay family bills. “These unwanted fees may not matter to the wealthy, but they certainly matter to those working in homes like the one I grew up in,” he added, saying that these moves would give Americans “an outlet.”

The Federal Trade Commission unveiled a proposed rule that the Biden administration says would prevent businesses from charging hidden or misleading fees and require businesses to show full prices upfront, preventing event ticketing companies, hotels, lodging companies, apartment and car rental agencies, and more from charging surprise or unexpected service fees. .

“If this proposed rule is finalized as proposed, the FTC would have the ability to impose financial penalties on companies that do not disclose their full price upfront and secure refunds for customers who have been defrauded by companies that charge hidden fees,” he said.

According to one official, the proposed junk-fee rule would not limit what vendors can charge, but would require vendors, including ticket sellers, to disclose final costs up front.

“We want companies to compete on prices, not on their ability to hide prices from consumers,” the official said. “So what our rule will do is ask for pricing up front, so consumers can look for the ticket seller that offers the best deal and honest business and have a fair chance to compete.”

The official, who was speaking before the announcement, noted that although it is already illegal for companies to hide fees on the back of sales, the administration is prepared to take enforcement action against companies that charge excessive fees, so “businesses should not wait for the release of… a base”. “Until this is done, they must act now to ensure their compliance.”

Additionally, the CFPB will take steps to prevent large banks and credit unions from charging consumers for basic services such as checking bank account balances, obtaining a bonus amount for a loan, or obtaining account information needed for applications.

The CFPB’s proposed rule would also require banking institutions to allow consumers to securely send transaction data to other companies, making it easier for customers to switch providers “to ensure financial companies compete on the basis of quality of service and upfront pricing, deterring unwanted fees.”

Biden also noted that the CFPB “prohibits banks and credit unions from charging fees for basic service like checking your account balance, retrieving old bank records, or looking up your balance on a loan,” calling such fees “obscene.”

“These fees are now illegal,” Biden said, adding that there are “tens of billions of dollars in other unwanted fees throughout the economy,” and he has directed his teams to crack down on those fees as well.

This story has been updated with comments from President Joe Biden.