Credit card companies and banks often tack on extra fees to the consumer that sometimes we aren’t even aware of. Recently, there has been a crackdown on these hidden fees from regulatory bureaus and lawsuits. Many of these lawsuits over hidden fees have been settled and regulations have gone into effect putting money back in the pockets of Americans. Read on to find out about some of the hidden fees consumers were being charged by major credit card companies and banks.
ATM Fees Lawsuit
Visa and Mastercard have recently settled a lawsuit for inflating fees at ATMs. Claims were made that additional ATM fees imposed by banks associated with Visa and Mastercard networks were not clearly disclosed, court records show. The fees, called surcharges, happen when customers use ATMS outside of their bank’s network. The lawsuit was settled for $197.5 million.
Merchant Fees
A lawsuit was brought against Visa and MasterCard claiming that the credit card company overcharged retailers on interchange fees, or swipe fees, when patrons used credit or debit cards. Additionally, it prohibited retailers from directing customers toward other means of payment. The case resulted in a $5.5 billion class-action settlement.
Junk Fees
In March of 2024, The Consumer Financial Protection Bureau (CFPB) finalized a rule to cut excessive credit card late fees. The CFPB lowered the typical late fee from $32 to $8. This rule change will save Americans more than $14 billion a year. The ruling is currently being challenged in the court system with credit card companies arguing that reducing late fees punishes consumers who pay on time.
Undisclosed Financing Fees
In 2018, Wells Fargo was sued by a Texas jewelry company for encouraging hidden fees to customers in its financing program. Wells Fargo told retailers to build financing fees into the price of goods and advertise interest-free financing. But what customers may not have realized is that they could purchase the same item for much less with cash and avoid the built-in almost double-digit interest fee. Ultimately, the lawsuit was dismissed.
Protecting Yourself Against Hidden Fees
As a consumer, it’s important that you are aware of charges to your accounts. Remember, always read the fine print when signing up for a credit card or loan. Some credit cards will try to sell you on add-ons when you sign up. For example, some companies will pitch you identity monitoring services or credit protection. Other additional fees to look out for are foreign transaction fees, cash advance fees, and balance transfer fees. The Credit Card Act of 2009 protects consumers against hidden fees. It also requires credit card companies to increase transparency around credit card terms.
Ultimately, if you see a charge on your credit card or bank statement that you don’t recognize, you can dispute it. Additionally, you can file a complaint with the Consumer Financial Protection Bureau (CFPB) if you believe you’ve been charged an excessive fee.
Do any of these lawsuits over hidden fees surprise you? Let us know your thoughts in the comments.
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Teri Monroe started her career in communications working for local government and nonprofits. Today, she is a freelance finance and lifestyle writer and small business owner. In her spare time, she loves golfing with her husband, taking her dog Milo on long walks, and playing pickleball with friends.