Dauphine Island Despite the federal investments in banking now, many of the biggest seem to be accelerating predatory practices particularly around fees. During normal times working families stretching every penny to pay bills will occasionally bounce a check. Who hasn’t?
Banks seem to in fact count on us bouncing some checks in order to balance their own accounts.
Recent reports indicate that US banks will collect $38.5 billion in overdraft fees in 2009 (according to Financial Times).
The highest bounced check charges are coming from the federal banks like Citigroup, and Bank of America, JPMorgan Chase. An account holder bouncing a $10 check could be socked with a $35 penalty. Oh, and don’t forget to replace the 10 spot.
Don’t bother to ask how much of that charge is pure, grade-A profit, because it’s little but profit in the automated systems of modern banking. We need some financial justice rather than more fees for NO service.
Dauphine Island The Community Reinvestment Act (CRA) passed in 1977 occupies a lot of space in my book, Citizen Wealth, because it is both arguably the single largest legislative victory achieved by community organizations over the last generation and because it has helped millions purchase homes, one of the most dramatic creators of citizen wealth for lower income and working families, especially in minority communities. The Obama Administration has proposed a super-cop, the Consumer Financial Protection Agency (CFPA), to ensure that CRA and other consumer protections are fully followed and enforced across the gamut of financial institutions.
Yippee, yi-ky-yay! Thank god!
As Phyllis Salowe-Kaye, Executive Director, New Jersey Citizen Action recently wrote in the Star-Ledger:
“The CFPA proposed by the president would have broad institutional oversight of enforcement responsibilities for the wide range of financial consumer protection laws already in place, including CRA, and bolsters the chances of passage of the Community Reinvestment Modernization Act of 2009…This law would strengthen CRA as it is applied to banks and expand CRA’s reach to non-bank financial institutions. There is a critical need to have independent mortgage companies and other non-bank lenders subject to the same rules as banks. Quite simply, if you are doing the same business, you should be subject to the same rules.”