This week, Arizona Attorney General Kris Mayes announced she's joining the fight to limit overdraft fees imposed by big banks.
Mayes, along with 22 other attorneys general, signed a letter to the leadership in the U.S. House of Representatives urging them to vote against a resolution that would overturn the Consumer Financial Protection Bureau’s (CFPB) 2024 rule limiting overdraft fees imposed by the country’s largest banks.
The coalition of attorneys general said the rule prevents big banks with over $10 billion in assets from charging excessive overdraft fees that can hurt their customers’ credit and sometimes lead to account closures.
“Banks should not be profiting from people's misfortunes,” said Attorney General Mayes in a press release. “These fees often hit Arizonans at the worst possible time—when they’re already struggling to make ends meet. The CFPB’s rule is a critical safeguard to ensure that financial institutions treat their customers fairly and stop exploiting individuals and families living paycheck to paycheck.”
Overdraft fees can also be a major profit maker for big banks. They account for about $6 billion in revenue in 2023.
Attorney General Mayes and the coalition state in their letter that under the CFPB’s rule, if banks intend to continue profiting from such fees, they believe banks must treat them as interest on a loan.
They used the comparison that given most overdraft fees are paid back in less than three days, a typical fee of $35 on an average overdraft of $26 is the equivalent of an annual interest rate of 16,000 percent.
Earlier this year, the Trump administration tried to dismantle the CFPB, but last week, a federal judge blocked it.
