Unreasonable Obstacles on Consumers

The CFPB issued an Advisory Opinion regarding Section 1034(c) of the Dodd Frank Act, which generally prohibits large banks and credit unions from imposing unreasonable obstacles on customers for basic information about their own accounts. Large banks and credit unions under the CFPB’s regime must provide complete and accurate account information when requested by accountholders. The Advisory Opinion clarifies that consumers are entitled to get the basic information they need without having to pay junk fees.

While the statutory text says nothing about fees, the CFPB said it would interpret the statute to include excessive fees as “unreasonable obstacles on customers.”

When large financial institutions charge fees to respond to those requests, they impede customers from obtaining the essential information they are entitled to under federal law. From its market monitoring and the public’s comments about large banks’ customer service, the CFPB is aware that some large banks charge customers for basic information that is critical to fix problems with their bank account or to manage their finances. 1




A covered person subject to supervision and primary enforcement by the Bureau pursuant to section 1025 shall, in a timely manner, comply with a consumer request for information in the control or possession of such covered person concerning the consumer financial product or service that the consumer obtained from such covered person, including supporting written documentation, concerning the account of the consumer.

A covered person subject to supervision and primary enforcement by the Bureau pursuant to section 1025, a prudential regulator, and any other agency having jurisdiction over a covered person subject to supervision and primary enforcement by the Bureau pursuant to section 1025 may not be required by this section to make available to the consumer—
(A) any confidential commercial information, including an algorithm used to derive credit scores or other risk scores or predictors;
(B) any information collected by the covered person for the purpose of preventing fraud or money laundering, or detecting or making any report regarding other unlawful or potentially unlawful conduct;
(C) any information required to be kept confidential by any other provision of law; or
(D) any nonpublic or confidential information, including confidential supervisory information.

The bureau added that it will not pursue monetary relief for violations of its interpretation of Section 1034(c) prior to Feb. 1, 2024.

Also, on October 11th:

A White House Release states “the CFPB is taking action to require large banks and credit unions to provide basic information to consumers without charging fees—meaning no more fees for basic services like checking bank account balances, obtaining a payoff amount for a loan, or getting account information needed for applications.”

The FTC announced a new proposed rule to prohibit junk fees. The proposed rule would ban businesses from running up the bills with hidden and bogus fees, ensure consumers know exactly how much they are paying and what they are getting, and help spur companies to compete on offering the lowest price. Businesses would have to include all mandatory fees when telling consumers a price, making it easier for consumers to comparison shop for the lowest price.

The CFPB published a special edition of its Supervisory Highlights focusing on junk fees. This Supervisory Highlights covers junk fees in the areas of bank account deposits, auto loan servicing, and remittance transfers found during examinations between February and August 2023. CFPB oversight has identified instances of companies charging a variety of junk fees, including for:

  • Fake paper statements: Some institutions charge customers monthly fees for sending paper bank statements. CFPB examiners found instances where banks charged fees for statements they never actually printed or mailed.
  • Worthless add-on products for paid-off auto loans: When people purchase cars, they sometimes have purchase loan add-on products, like guaranteed asset protection (GAP) insurance. In situations when borrowers paid off their loan early or had their vehicle repossessed, CFPB examiners found that loan servicers continued to charge fees for the add-on products, which no longer offered any value.
  • Sloppy international money transfers: CFPB examiners found remittance providers charged hidden fees by taking money out of the funds consumers sent without properly disclosing them. In other instances, CFPB examiners found remittance providers failed to refund fees when the money consumers sent failed to arrive on time.



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