The CFPB Study Shines Spotlight on Banking Fees as a Presage to Greater Regulatory Scrutiny of Consumer Banking Fees
The Consumer Financial Protection Bureau (“CFPB”) has enhanced its regulatory scrutiny of the fees financial institutions assess on consumer depositors. To better understand the gamut of such fees and financial institutions’ practices with respect to the same, the CFPB has required financial institutions to submit detailed quarterly statements identifying and breaking out the various types of fees assessed on consumer accounts. In particular, the CFPB has required them to provide aggregate amounts charged as (i) overdraft and non-sufficient funds (“NSF”) fees; (ii) periodic account maintenance fees; and (iii) ATM fees (in particular, the fees charged in connection with consumer transactions at out-of-network ATMs). The CFPB has now analyzed the consumer fee data going back to 2015 and published two reports: (i) Data Point: Overdraft/NSF Fee Reliance Since 2015—Evidence from Bank Call Reports; and (ii) Data Point: Checking Account Overdraft at Financial Institutions Served by Core Processors. In general, the reports reveal that overdraft and NSF fees constitute one of the primary sources of financial institution revenues generated from consumer banking operations. Indeed, overdraft fees alone generated more than $15 billion in revenues for banks and credit unions in 2019.