US Chamber Of Commerce Initiates Lawsuit Against CFPB Regarding Late Card Fees
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
The United States Chamber of Commerce has Initiated a legal action against the Financial Protection Bureau (CFPB) to prevent it from enforcing a rule to restrict late credit card charges.
Earlier this month, the CFPB created a rule to reduce too many credit card late charges by shutting down a loophole used by Major card issuers.
The CFPB Seeks To Implement A Final Rule To Reduce Late Payment Charges
The CFPB cited that families living in America will save over $10 billion in late charges every year as soon as the final rule is implemented by decreasing the standard charge from $32 to $8. This will indicate an average savings of $220 each year for over 45 million individuals who are billed late fees.
UA Chamber chief policy officer, Neil Bradley stated that consumers in America will gain from many credit cards that most meet their needs. And most credit card users comprehend the requirement to settle their bills early along with the fees associated with late payments.
Bradley added that, by significantly reducing late charges, the CFPB is not just preventing responsible use of credit cards, but also inflicting increased charges on consumers and restricting choices in credit card benefits and options.
He further stated that the Consumer Financial Protection Bureau (CFPB) is acting outside its bounds. However, the Chamber is taking legal actions that aim to safeguard American card owners who pay their bills on time. These holders can also appreciate the abundant benefits of various credit card offerings from institutions in the country.
CFPB Aims To Balance Consumer Protection And Industry Scrutiny
The US Chamber of Commerce contends that the charge against the consumer protection agency punishes responsible users of credit cards who pay their bills on time. It also claims that the CFPB determined its decision by relying on the adoption of secret data offered by financial institutions for an unrelated purpose.
The CFPB is an independent agency within the US government responsible for protecting consumers in the financial sector. CFPB’s jurisdiction includes debt collectors, foreclosure relief services, mortgage-servicing operations, payday lenders, securities firms, credit unions, banks, and other financial firms within the US.
Since its creation, the CFPB has adopted technology tools to observe how financial units leverage algorithms and social media to target consumers.
The founding of CFPB was authorized by the Consumer Protection Act and Dodd-Frank Wall Street Reform, whose opening in 2010 was a legislative reaction to the financial crisis of 2007-2008.
