Unfair Returned Deposited Item Fee Assessment Practices

On October 26, the CFPB released Bulletin 2022-06: Unfair Returned Deposited Item Fee Assessment Practices. The Bulletin states that having “blanket policies of charging Returned Deposited Item fees to consumers for all returned transactions irrespective of the circumstances of the transaction or patterns of behavior on the account are likely unfair.”

The Consumer Financial Protection Act (CFPA) prohibits covered persons from engaging in unfair acts or practices. An unfair act or practice is one that “causes or is likely to cause substantial injury to consumers which is not reasonably avoidable,” and “such substantial injury is not outweighed by countervailing benefits to consumers or to competition.” The CFPB states that consumers are not able to reasonably avoid monetary injury imposed by blanket fees, as consumers would not normally be aware of, and have little to no control over, whether a deposited check will clear.

Liability under the prohibition on unfair acts or practices depends on the particular facts and circumstances. The CFPB states that violations would be unlikely if institutions’ policies only charge fees if consumers repeatedly deposit bad checks from the same originator, or only charges consumers a fee when deposited checks are unsigned.



Please be advised that CSG provides financial services compliance audit and consulting services to our clients.  The services that we provide include certain tasks that may be characterized as “law-related services” under Rule 5.7 of the Rules of Professional Conduct governing lawyers.  Since some of our employees are lawyers with an active bar license but are NOT engaged in the private practice of law, that Rule requires us to make disclosures clarifying that the services we perform may be law-related services, but they are not legal services.  Because they are not legal services, those services and our relationship will not be governed by the Rules of Professional Conduct that guide the client-lawyer relationship, such as rules applicable to privileged communications and prohibitions of conflicts of interest.  Notwithstanding this disclaimer, we will continue to govern our relationship with you using reasonable ethical and professional standards that are expected to meet your expectations.


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