TRENTON, NJ — New Jersey Attorney General Matthew J. Platkin has joined a multistate coalition urging the U.S. House of Representatives to reject a resolution that would roll back a federal rule capping overdraft fees charged by major banks.
Key Points
- AG Platkin opposes federal resolution that would lift limits on overdraft fees
- Current CFPB rule caps fees at $5 or the actual cost of overdraft protection
- In 2023, U.S. banks made $5.8 billion from overdraft fees
AG joins coalition to defend CFPB overdraft rule
In a letter submitted to House lawmakers, Platkin and attorneys general from 24 other jurisdictions argued against overturning the Consumer Financial Protection Bureau’s Final Rule, which limits overdraft fees imposed by banks with over $10 billion in assets. The rule, announced in December 2024, caps overdraft charges at $5 or the institution’s actual cost of coverage.
“New Jerseyans, like the rest of Americans, are already facing rising prices and an uncertain economic future,” Platkin stated, criticizing lawmakers who would “vote against consumers and take the side of the largest banks with billions of dollars in profits.”
Overdraft fees, typically around $35, are often charged even when the overdrawn amount is under $26 and repaid within days, according to the Office of the Attorney General. Banks collected $5.8 billion in overdraft fees in 2023 alone.
States demand consumer protection
The letter was signed by attorneys general from 22 states and the District of Columbia, as well as the Hawaii Office of Consumer Protection. They argue that overdraft fees have become a major revenue source for large banks and disproportionately impact low-income customers.
“Consumers faced with these junk fees are effectively paying extremely high-interest loans,” said Cari Fais, Director of the Division of Consumer Affairs.
The CFPB’s Final Rule does not apply to smaller banks, targeting only the largest institutions with assets over $10 billion. Supporters say the rule protects consumers without compromising financial services.
