Lawmakers seek probe on banks' new debit card fees - CBS News 8 - San Diego, CA News Station - KFMB Channel 8

Lawmakers seek probe on banks' new debit card fees

Posted: Updated:

WASHINGTON (AP) — Members of Congress are asking the Justice Department to investigate whether Bank of America and other major banks improperly worked together to charge customers new monthly fees for using their debit cards.

Rep. Peter Welch, D-Vt., and four other Democrats said Thursday that they've asked Attorney General Eric Holder to open a probe into possible collusion by the banks.

Welch said the lawmakers had no evidence of collusion. But he said the timing of the fees merit an investigation.

"You don't have a competitive marketplace," Welch said at a news conference.

Bank of America said last month that it would charge its customers $5 a month if they use their debit cards for purchases. Customers who use their cards only at ATMs will not have to pay the fee.

Chase and Wells Fargo are also testing $3 monthly debit-card fees in select markets.

The fees have sparked public outrage and helped fuel protests on Wall Street. Many have criticized the banks for charging to use debit cards after those same banks received hundreds of billions of dollars in taxpayer-funded bailouts. Bank of America, Chase and Wells Fargo were among the recipients of rescue funds.

Bank of America, the nation's largest bank, said the monthly charge was necessary because the Federal Reserve has capped the fees that they can charge merchants for swiping the debit cards. Congress directed the Fed to adopt the cap on swipe fees under the financial overhaul law.

On Thursday, representatives for Bank of America and Chase declined to comment on the lawmakers' request for a probe. A representative for Wells Fargo wasn't immediately available for comment.

Also requesting the investigation were Democratic Reps. John Conyers of Michigan, Keith Ellison of Minnesota, Mike Honda of California and Raul Grijalva of Arizona.

The lawmakers said statements made by some banks and their trade associations raise questions about possible coordination.

In their letter to Holder, they cite an e-mail by the Texas Bankers Association to its members. It was sent after legislation failed that would have delayed a cap on the swipe fees banks can charge merchants.

The e-mail said: "Now the industry must regroup and each and every one of you must decide how you are going to pay for the use of debit cards. It may be through a monthly fee."

The Merchants Payments Coalition, an organization of trade groups for a variety of retailers, supported the lawmakers' move.

Bank of America will start charging the fee early next year. Chase and Wells Fargo haven't said when they will make a final decision on whether to roll out the debit-card fee more broadly.

Copyright 2011 The Associated Press.

  • Local NewsMore>>

  • Brush fire near Pauma Valley 100% contained

    Brush fire near Pauma Valley 100% contained

    Thursday, May 24 2018 10:13 PM EDT2018-05-25 02:13:46 GMT

    Crews dousing the smoldering remnants of a roughly 60-acre wildfire near Pala Casino had the burn area 100 percent contained Thursday night.

     

    Crews dousing the smoldering remnants of a roughly 60-acre wildfire near Pala Casino had the burn area 100 percent contained Thursday night.

     
  • Man accused of chasing girl with machetes in La Mesa charged

    Man accused of chasing girl with machetes in La Mesa charged

    Thursday, May 24 2018 9:49 PM EDT2018-05-25 01:49:56 GMT

    A terrifying scene played out in La Mesa earlier this week when an eighth grader was chased by a man with machetes on her way to school. The man accused – who allegedly had two machetes as he chased the 13-year-old girl – was shot by police and on Thursday was charged under unusual circumstances. 

     

    A terrifying scene played out in La Mesa earlier this week when an eighth grader was chased by a man with machetes on her way to school. The man accused – who allegedly had two machetes as he chased the 13-year-old girl – was shot by police and on Thursday was charged under unusual circumstances. 

     
  • Kitten Crash: Put a little 'meow' in the mix for your next party

    Kitten Crash: Put a little 'meow' in the mix for your next party

    Thursday, May 24 2018 9:40 PM EDT2018-05-25 01:40:48 GMT

    Imagine being at work, when suddenly your boss demands you stop what you're doing and take a break. In Thursday's Zevely Zone, Jeff's in the East Village with the San Diego Humane Society's first "kitten crash." 

     

    Imagine being at work, when suddenly your boss demands you stop what you're doing and take a break. In Thursday's Zevely Zone, Jeff's in the East Village with the San Diego Humane Society's first "kitten crash." 

     
Powered by Frankly
All content © Copyright 2000 - 2018 Midwest Television, Inc. All Rights Reserved.
For more information on this site, please read our Privacy Policy, and Terms of Service, and Ad Choices.