Congress finalized a vote Wednesday upending a rule that barred banks from charging high overdraft fees.
Under a 2024 rule issued by the Consumer Financial Protection Bureau (CFPB), large banks were prohibited from charging consumers the typical $35 per overdraft transaction. Instead, overdraft fees were capped at $5 in most cases.
But Wednesday’s bill, once signed by President Donald Trump, gives banks back the power to assess heavy fees.
Here’s what New Jersey says about it.
“It is unclear to me why elected representatives would vote against consumers and take the side of the largest banks with billions of dollars in profits,” NJ attorney general Matthew Platkin said in a statement.
In the past, New Jersey has supported CFPB efforts. In 2024, the state supported increased protections for people using digital payment services. And in 2022, New Jersey backed efforts to protect consumers from illegal student loan debt collection.
According to the Attorney General’s Office, most personal bank account overdrafts are for less than $26 and are repaid within three days.
“Consumers faced with these junk fees are effectively paying extremely high-interest loans that go well beyond the expenses banks incur related to overdrafts,” said Cari Fais, Director of the Division of Consumer Affairs.
“Overdraft fees have become profit drivers for banks, generating billions in revenue at the expense of consumers,” he added.
The Consumer Financial Protection Bureau is an agency created after the 2008 financial crisis to protect consumers from unfair practices.
The agency was one of the first to be dismantled in February by the Trump administration, with the help of Elon Musk’s Department of Government Efficiency.
In February, the agency’s headquarter’s signage was removed, its website was taken offline, and its 1,700 employees were sent home.
The bureau has since resumed processing consumer complaints after a federal judge issued a temporary block on the layoffs.
New Jersey was part of a multistate coalition to warn against efforts by the Trump Administration and Elon Musk to defund and disband the CFPB.
This article originally appeared on Asbury Park Press: Where does New Jersey stand on CFPB, bank-fee changes?