Federal Judge Halts New Rule on Credit Card Late Fees that Would Have Saved Consumers $14 Billion Annually

By Charlene Crowell | Trice Edney Wire (TriceEdneyWire.com) – May 14 was the day that the Consumer Financial Protection Bureau (CFPB) was set to implement a new rule that would save credit card holders an estimated $14 billion each year. The rule would provide& savings of $220 per year on average& for people who are charged late fees. Instead, a federal district judge imposed a temporary injunction that halted the rule’s implementation. & Reactions to the injunction marked a clear divide between corporate business interests that claimed and cheered a legal victory while many government and consumer groups saw the decision as harmful to the more than& 167 million consumers& who have credit cards.& & CFPB& seeks to lower credit card late fees to $8 per month, instead of the current $32 now charged by a $1 trillion industry that has steadily jacked up the price of delinquent fees for years. Further, the rule would only apply to card issuers that have one million or more accounts. It would also allow these very large issuers an opportunity to justify future proposed increases by showing the CFPB actual costs incurred. & Speaking on behalf of the Biden administration’s ongoing efforts to...