CBS Attacks Banks for Profiting from Overdraft Fees
Did you make a mistake balancing your checkbook and withdraw more money than you had in your account? Are you upset about the overdraft fee it cost you?
Well, your mistake isnâ€™t your fault â€“ that is according to a CBS â€śEvening Newsâ€ť report called â€śHidden Chargesâ€ť that complained about banks profiting from fees.
â€śBanks are cashing in on overdrafts, raking in more than $17 billion in fees last year, according to the Center for Responsible Lendingâ€ť said correspondent Anthony Mason on July 11.
Overdraft fees are anything but â€śhidden charges,â€ť since customers are informed when they open an account. CBS ignored the risk banks undertake by offering overdraft protection services as well as the benefit to consumers. Instead, Masonâ€™s report attacked the industry for making legitimate profits for its risk-taking.
CBS also did not offer direct comment from the banking industry to viewers of the broadcast.
In a July 11
â€śOverdraft protection is an important service for our customers, and we believe customers should understand the responsibilities to track deposits and withdrawals, and any fees associated with overdrafts and options to avoid them,â€ť Nessa Feddis, of the American Banking Association testified recently at a House hearing, according to the
Instead, Mason supplied comments from upset customers and the Center for Responsible Lending, an advocacy group that is pushing legislation introduced by liberals Rep. Carolyn Maloney (D-N.Y.) and Rep. Barney Frank (D-Mass.). The legislation would make overdraft fees subject to regulation under the Truth-in-Lending Act by calling the fees, loans.
â€śConsumers should have the right to decline the service and the fee,â€ť Maloney, said in a House hearing quoted by CBS.
Customers already have that right though. Mason admitted customers can instruct their banks not to pay overdrafts at the end of the report.