AG Shapiro asks consumer banks to eliminate overdraft fees – PA Attorney General’s Office

Take action with a letter to the CEOs of JPMorgan Chase, Bank of America, US Bank and Wells Fargo to eliminate overdraft fees

HARRISBURG – Attorney General Josh Shapiro, along with a multi-state coalition of attorneys general, today called on the CEOs of JPMorgan Chase, Bank of America, US Bank and Wells Fargo to eliminate all overdraft fees on accounts consumer banking. The letter goes on to urge every bank to eliminate these fees by this summer to create a fairer and more inclusive consumer financial system.

“We’ve seen how these fees hit families and communities of color harder than others,” AG Shapiro said. “This starts a vicious circle that pushes them deeper and deeper into debt. Eliminating these fees helps create a system that works for everyone.

In some cases, consumers may be charged $35 for a purchase of $5 or less if it exceeds their current balance. Studies have shown that the vast majority of overdraft fees fall on low-income consumers who earn less than $50,000 a year and communities of color. The consequences of these fees can be devastating to the financial health of consumers.

Although the harms of overdraft practices are fairly well known, overdraft fees continue to be a major activity for banks according to a recent study published by the Consumer Financial Protection Bureau (CFPB). JPMorgan Chase, Bank of America, US Bank and Wells Fargo are among the top five US banks by total assets. According to the CFPB, three of these institutions alone generated 44% of total overdraft and related fees in 2019. The elimination of overdraft fees by these four institutions would significantly improve the financial health of millions of consumers across the county. .

Earlier this year, Citi Bank announced it would eliminate overdraft fees, which followed a similar announcement late last year by Capital One.

Joining Attorney General Shapiro in sending the letter are the attorneys general of California, Connecticut, District of Columbia, Delaware, Illinois, Iowa, Maryland, Massachusetts, Michigan, Minnesota , New Jersey, New York, North Carolina (all except Bank of America), Oregon and Washington.

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