Judge Strikes Down Biden-Era Rule Capping Credit Card Late Fees At $8

2 months ago 26

Proiti Seal Acharya

Wed, Apr 16, 2025, 3:04 AM 2 min read

A Texas national justice has ruled against a Biden-era regularisation that would person capped credit paper precocious fees astatine $8, terminating a large inaugural by the Consumer Financial Protection Bureau (CFPB) to restrict what it labelled "junk fees."

The determination is being regarded arsenic a ineligible and governmental triumph for fiscal manufacture groups that resisted the regulation.

What Happened: U.S. District Judge Mark Pittman dismissed the CFPB rule, finalized successful March 2024, aft some the bureau and six large concern associations agreed it was unlawful. The regularisation was meant to prevention consumers an mean of $220 a twelvemonth by limiting precocious fees.

Pittman ruled that it conflicted with the 2009 Credit Card Accountability and Disclosure Act, which allows fees that are "reasonable and proportional." The suit was filed by the American Bankers Association, U.S. Chamber of Commerce, and galore Texas concern groups.

See Also: Trump’s CFPB Overhaul Leaves Consumers Exposed—Here’s What It Means For Your Money

Why It Matters: The court's ruling deals a setback to the Biden administration's larger effort to instrumentality down what it called predatory user charges. Those opposing the regularisation argued it would backfire.

"It would person resulted successful much precocious payments, little recognition scores, higher involvement rates and reduced recognition access," the plaintiffs said successful a associated statement. They added that the result was a triumph for fiscal work and "common sense."

The CFPB's effort to reformulate the recognition paper interest operation present faces a large hindrance. With rising scrutiny of the agency's authorization and ineligible footing, the aboriginal of national user extortion efforts hangs successful limbo, peculiarly arsenic calls to bounds oregon adjacent unopen down the CFPB summation attention.

Read Next:

A 52-Year-Old Man Who Owes Money On 27 Credit Cards Gets An Ultimatum From Dave Ramsey: ‘Chop Them All Up. Every One Of Them’

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