President Joe Biden announced further progress on his administration’s “competition agenda” on Wednesday, specifically targeting unwanted fees while calling on Congress to pass legislation targeting hidden fees in multiple sectors.
These costs can “drain hundreds of dollars a year from the pockets of hard-working American families, especially people who are already struggling to make ends meet — but not anymore after today,” Biden said at the fourth meeting of the Presidential Competition Council on Wednesday.
Legislation proposed in partnership with the Consumer Financial Protection Bureau, called the Junk Fee Protection Act, would target four types of excessive fees:
- excessive charges for online concerts, sporting events and shows
- airfares for families seated together on flights
- exorbitant early termination fees for TV, phone and internet services
- surprise resort and destination fees
In brief remarks ahead of the meeting, Biden had called credit card late fees in particular an “unwanted fee if there was one,” saying the new CFPB guidelines would reduce those fees.
“Today’s rule proposes to reduce that fee from an average of $31 to $8,” he added. “This change is expected to save Americans tens of millions of dollars, or about $9 billion a year in total savings.”
Biden called on Congress to pass the unwanted fee legislation, saying it would give “hard-working Americans a little more leeway.” It’s part of a plan, he added, to build “a competitive economy and an economy that works for everyone.”
Rohit Chopra, director of the CFPB, noted ahead of the announcement that “more than a decade ago, Congress banned excessive late fees on credit cards.”
“But the companies exploited a regulatory loophole that allowed them to escape scrutiny for charging otherwise illegal unwanted fees,” he added in a statement to CNN. “Today’s proposed rule is intended to save families billions of dollars and ensure the credit card market is fair and competitive.”
Another category of fees that frustrates many customers is for event tickets sold online, for which additional fees are often high – and usually appear late in the checkout process when a customer is about to make procurement.
For example, earlier this year, lawmakers grilled Live Nation president and chief financial officer Joe Berchtold following a ticket sales debacle over exorbitant box office fees. Although the company said Wednesday it supports the reform, it also said it opposes the bill.
“We stand ready to work with the President and Congress on many common-sense ticketing reforms, while denouncing proposed legislation that would benefit scalpers rather than artists and fans,” the company said in a statement. a statement.
Biden’s transportation department also took action last fall at the Competition Council’s previous meeting to reduce “unnecessary hidden fees” from airlines and travel sites that the president said were “burdening family budgets.