Great Lakes Wire

Michigan Attorney General Dana Nessel has aligned with 22 other attorneys general, sending a letter to the U.S. House of Representatives and the House Financial Services Committee. The letter urges them to oppose House Joint Resolution 59. This resolution aims to overturn a Consumer Financial Protection Bureau (CFPB) rule set to take effect on October 1, 2025. The rule intends to limit excessive overdraft fees charged by large financial institutions.

On December 12, 2024, the CFPB amended Regulations Z (Truth in Lending Act) and E (Electronic Funds Transfer Act). The amendment requires institutions with assets over $10 billion to cap overdraft fees at either $5 or cover the actual costs incurred by the bank for overdraft protection.

In the letter, the attorneys general argue that without the rule, institutions could continue charging fees, averaging $35, despite most overdrafts being less than $26 and resolved within three days. These charges can equate to over 16,000% in annual percentage rate terms. The coalition also contends that some banks manipulate transactions to increase fee revenue, making it challenging for consumers to maintain positive account balances.

"Excessive overdraft fees are predatory, causing unnecessary burdens for consumers," Nessel stated. "This critical CFPB rule ensures that these fees are proportionate and transparent. Rejecting such a rule is just another attempt to undermine the vital work of the CFPB, which has always been in the corner of Michiganders, protecting them from deceptive fees, predatory loans, and shady financial schemes and putting money back in the pockets of hard-working families."

The coalition, including Arizona, California, Colorado, and others, emphasizes the CFPB's role in aiding Americans by halting junk fees and returning $20 billion to consumers. Attorney General Nessel also released a video to highlight the importance of the CFPB and its challenges.

Joining Nessel in the coalition are the attorneys general from various states and the District of Columbia. The Hawai’i Office of Consumer Protection has also backed the coalition.