ALBANY, N.Y. (NEWS10) — New York Attorney General Letitia James has sent letters to the CEOs of four banks, calling on them to eliminate overdraft fees. The letters were sent to JPMorgan Chase, Bank of America, U.S. Bank, and Wells Fargo.
“For too long, excessive overdraft fees have hurt the most financially vulnerable New Yorkers,” said James. “Working families and low-income New Yorkers cannot afford to continue to be harmed by this unfair and punitive practice, while banks reap big profits. I am calling on the largest consumer banks in the nation to do the right thing and remove overdraft fees. We need a fairer and more inclusive banking system that supports all New Yorkers.”
This was part of a multi-state coalition. The attorney generals of California, Connecticut, the District of Columbia, Delaware, Hawaii, Illinois, Iowa, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, North Carolina, Oregon, Pennsylvania, and Washington all sent letters to the banks.
James said overdraft fees have had harmful effects on millions of people nationwide. Consumers can sometimes be charged as much as $35 for a purchase of $5 or less. According to the Center for Responsible Lending, a study of overdraft fees charged in 2019 found that more than $11 billion in fees were charged, with 84% of those fees going to consumers with the lowest average account balances.
According to a recent study published by the Consumer Financial Protection Bureau, JPMorgan Chase, Bank of America, U.S. Bank, and Wells Fargo are among the top five U.S. banks in total assets. James said the elimination of overdraft fees by these four banks would improve access to fairer banking options for millions of New Yorkers.
James said Citi Bank and Capital One have both announced that they would eliminate overdraft fees. Citi Bank is the largest U.S. bank to take this step.