New York AG opposes changes to federal overdraft rules

PHOTOGRAPHER: Gazette Staff Report

ALBANY — State Attorney General Letitia James said Tuesday she is leading a group of 25 state attorneys general in opposing any relaxation or elimination of the federal Overdraft Rule.

The federal Consumer Financial Protection Bureau is considering changes to the decade-old regulations on how financial institutions can charge customers for spending more money than they have in their account.

James said studies released by the CFPB have shown that median fees can cost as much as 68 percent of median overdrafted transactions — when the median overdrafted transaction was $50, for example, the median fees charged were $34.

James said CFPB data show that only about 16 percent of consumers have chosen to affirmatively opt into overdraft services under the Overdraft Rule, which has benefited millions of Americans and led to a significant reduction in the total number and amount of overdraft fees.

“If the CFPB rolls back this rule, it would put hard-working people in harm’s way by allowing banks to charge more overdraft fees, all in the name of corporate greed,” she said.