Jonathan Stempel
(Reuters) – A federal judge on Tuesday concluded the late fees for the U.S. Consumer Financial Protection Agency at $8 after agents agreed to opposition that rules adopted during President Joe Biden’s administration were illegal.
US District Judge Mark Pittman of Fort Worth, Texas, recognized the joint request by the CFPB and the alliance of six business and banking groups, including the US Chamber of Commerce and the American Bankers Association.
Pittman, an appointee of President Donald Trump, agreed that the rules violated the 2009 Credit Card Accountability and Disclosure Act.
The rules concluded the late fees for issuers with more than 1 million open accounts unless they could prove they needed to cover the costs.
It was part of Biden’s crackdown on “junk fees,” with the aim of reducing the typical late fees from around $32.
The Trump administration has reversed many Biden-era rules and policies that they consider not business friendly.
In a lawsuit against the March 2024 rules, the business and banking groups accused the CFPB of overstated its authority, ignoring Congress’s intentions that fees were high enough to prevent slow payments and compensate card issuers for costs.
They also said the rule was unfair to many consumers. Because it forces the issuer to pass costs to the cardholder who pays the bill on time.
In a joint statement on Tuesday, the group was called Pittman’s order, “a victory over consumers and common sense.”
The Trump administration has also tried to dismantle the CFPB.
On April 11, the Federal Court of Appeals in Washington, D.C., said the administration could reduce the CFPB but not to the extent that it would not be able to carry out its legal duties.
(Reporting by Jonathan Stempel of New York; Additional Report by Douglas Gillison of Washington; Jack Queen, Editor of New York
