Republicans Blast Fed For Trying To Eliminate Overdraft Fees
Williston, ND (KEYZ) - Senator Cramer and members of the Banking Committee slammed the CFPB for pursuing an extreme and highly politicized agenda.
Republicans see the move Consumer Financial Protection Bureau Director Rohit comes without regard to legal restraints and for using inappropriate and questionable legal strategies to unfairly harm the reputations of financial institutions and their relationships with their clients.
“Rather than operating as a tough, but fair and sensible regulator, the CFPB is again pursuing a radical and highly-politicized agenda unbounded by statutory limits. It has adopted an arrogant regulatory ethos: the CFPB can do whatever it wants. On at least one occasion, the CFPB has been criticized by a federal judge and former regulator for deploying inappropriate and legally dubious tactics that have unfairly damaged financial institutions’ reputations and customer relationships. The CFPB’s actions, which have been uncontrolled and unwarranted, will ultimately lead to costlier credit, or no credit at all, for millions of Americans,” wrote the senators in their letter.
The senators believe that the CFPB overstepped its bounds by pressing businesses to do away with overdraft fees. The CFPB boasted that its campaign persuaded several banks to alter their overdraft policy when it released a graphic in February 2022 identifying the top 20 banks by overdraft charge revenue. Director Chopra publicly warned that the CFPB is "increasing our supervisory scrutiny of the institutions that are most dependent on [overdraft fees] as part of their deposit account fee revenue" in July 2022 and expressed his "gratification to see where the market has been shifting" on overdraft fees.
The CFPB's most recent change to its own rules of adjudication, which enables the director to avoid administrative law judges and makes it simpler for director Chopra to serve as both a prosecutor and a judge, was also condemned by the Banking Republicans.
Republicans have expressed concern about the CFPB's use of "very unusual and improper techniques" to damage the customer connections of a bank embroiled in a legal dispute with the agency. The CFPB emailed the bank's customers in March 2022 with a poll referencing the lawsuit and asking if the bank was acting in the best interests of its clients.
The letter concludes by urging Director Chopra to stop using improper tactics to harm the reputations of financial institutions and to stay within the boundaries of the law.