WASHINGTON (Reuters) -Top White House officials and the head of the Consumer Financial Protection Bureau (CFPB) on Wednesday urged states to expand efforts to crack down on surprise fees consumers are forced to pay on everything from rental housing to cable bills.
The push is part of President Joe Biden’s government-wide effort to reduce or eliminate “junk fees” that jack up costs for consumers. Some agencies have already taken action, including a proposed rule by the CFPB to cut most credit card late fees and a Department of Transportation proposal to require airlines to disclose all fees up front.
Biden’s domestic policy adviser, Susan Rice, said some fees were slapped on without the consumer’s knowledge. “There are the surprise fees that show up after a hospital visit or predatory fees like bank overdraft fees,” she said.
Biden has vowed to keep attacking the issue on the federal level, and the White House said on Wednesday that action by state governments is also “essential” to rid the U.S. economy of billions of dollars in “unnecessary, unavoidable or surprise charges.”
To boost their efforts, the White House hosted a virtual meeting on Wednesday with hundreds of state legislators, some of whom shared actions they have taken to reduce or eliminate junk fees by beefing up enforcement, passing new laws or even changing their contracts with third-party providers.
At the meeting, CFPB Director Rohit Chopra cited a legal strategy that state governments could use.
“Most states, just like at the federal level, have a prohibition on unfair and deceptive practices. States can also enforce a prohibition on certain abusive acts or practices,” he said.
The administration also released a new guide that maps out actions states can take.
“These junk fees, which are often not disclosed upfront and only revealed after a consumer has decided to buy something, obscure true prices and dilute the forces of market competition that are the bedrock of the U.S economy,” the guide said.
In a separate letter dated Tuesday, Housing and Urban Development Secretary Marcia Fudge urged housing providers and state and local governments to protect renters from “hidden, duplicative, or unnecessary fees” that hit those with low and modest incomes the hardest.
(Reporting by Andrea Shalal; additional reporting by Diane Bartz; Editing by Bradley Perrett and Leslie Adler)
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