A Congressional committee is moving to overturn a new rule that caps overdraft fees.
On Friday, the House Financial Services Committee published a draft resolution to be considered Wednesday that would repeal an overdraft fee rule the Consumer Financial Protection Bureau finalized in December.
The rule caps overdraft fees at $5 from $35 previously for big banks with more than $10 billion in assets, such as Bank of America, JP Morgan Chase and Wells Fargo.
JPMorgan Chase took in more than $1 billion in overdraft and non-sufficient funds fees in 2023 and Wells Fargo took in nearly $1 billion, according to CFPB research.
But banks have been charging fewer overdraft fees in recent years after facing scrutiny: Bank of America took in $140 million in 2023, down from nearly $1.6 billion in 2019.
Still, the CFPB said the rule will save $5 billion a year for 23 million households paying overdraft fees.
And overturning the rule will cost households paying overdraft fees an average of $225 more a year, the nonprofit National Consumer Law Center said.
“Why would members of Congress side with big banks that take billions from people struggling with high prices and stop a rule that will reduce most overdraft fees from $35 to $5?” said Lauren Saunders, associate director at the NCLC.
Under the Congressional Review Act, a simple majority in Congress with the president's signature can overturn regulations in an expedited process, the NCLC said.
The House Financial Services Committee, chaired by French Hill (R-Ark.), directed ConsumerAffairs to a statement Hill made in December after the CFPB finalized the rule: "Capping overdraft services is another form of government price controls that hurts consumers who deserve financial protections and greater choice."
On Monday, Hill said the CFPB is an "unaccountable agency" and he would work with Treasury Secretary Scott Bessent, who is now serving as the CFPB's acting director, to "reign in" the agency.
Email Dieter Holger at dholger@consumeraffairs.com.