The White House is set to announce new initiatives aimed at reducing surcharges, or “junk” fees, tied to goods and services in partnership with two major consumer-protection agencies. President Joe Biden, along with Federal Trade Commission Chair Lina Khan and Consumer Financial Protection Bureau Director Rohit Chopra, will reveal new policy proposals from the two agencies. The FTC’s proposal would prohibit businesses from burying fees within a transaction and require upfront presentation of surcharge amounts and purposes, potentially saving consumers over $10 billion over the next decade. The CFPB is targeting big banks and highlighting consumers’ rights to access complete, accurate, and free account information. These initiatives are part of the administration’s broader effort to increase competition across industries.
The partnership between the White House, the FTC, and the CFPB aims to address the issue of surcharges and “junk” fees that affect consumers’ expenses. According to Lael Brainard, director of the National Economic Council, these fees may not have a significant impact on the wealthiest Americans, but they have a considerable impact on hardworking Americans trying to manage their bills. The FTC’s rule proposal would require businesses to be transparent about fees, potentially saving consumers billions of dollars over the next decade. Additionally, the CFPB is targeting big banks by emphasizing consumers’ right to access accurate and free account information. The administration’s goal is to promote fairness and increase competition across sectors, starting with Biden’s executive order on competition in the economy.
The initiatives proposed by the FTC and CFPB are part of ongoing efforts to crack down on junk fees. Both agencies have previously taken preliminary actions to address excessive fees in credit cards, ticketing, and other areas. The proposals seek to establish new rules and regulations that protect consumers from unfair practices and promote competition. The federal Office of Information and Regulatory Affairs, in collaboration with the National Economic Council and the Council of Economic Advisers, will provide guidance to help federal agencies implement these new standards. The initiatives, once finalized, will undergo a comment period before being enacted.
