Cordray Taking on Over Draft Fees

“Cordray encouraged financial institutions to offer lower-risk account options, including accounts that would not allow for overdrafting the account.” according to the Credit Union Times.  They’re pressuring financial institutions to go to more of a prepaid option that does not overdraw the account.  Basically, the payment does not get honored.

A few points were brought up that relate the short term loan industry:

  • Overdraft does not create the most complaints so why is the CFPB attacking it?  Cordray dodged the question.
  • Can the CFPB use their discretion to smaller institutions?  He said “No.”
  • There is no timeline for the rules…..what’s new.  I guess no news is good news.



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