Court blocks limits on credit card late fees

A proposed federal rule would block banks from imposing junk fees - ConsumerAffairs

A Texas judge granted an injunction blocking the rule from taking effect on Tuesday

A judge in the U.S. District Court for the Northern District of Texas granted the banking industry an injunction that could be costly for credit card customers.

U.S. District Judge Mark Pittman granted a preliminary injunction against the Consumer Financial Protection Bureau's credit card rule, preventing it from taking effect May 14, as scheduled. The injunction was requested by the U.S. Chamber of Commerce and the American Bankers Association.

The proposed rule would have placed limits on credit card late fees. The judge in the case ruled that the plaintiffs in the case would have a good chance of prevailing in their court challenge to the rule, based on a previous ruling by the Fifth Circuit Court of Appeals. That previous case cited by the plaintiffs is currently before the U.S. Supreme Court.

The CFPB proposed the rule to limit credit card late fees in early 2023.

Earlier this year, the CFPB proposed another rule to limit the fees banks and other financial institutions impose on customers. 

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