Three Democratic senators have introduced legislation to revive a Biden-era rule that would lower the cap on credit card late fees to $8.
The Credit Card Fairness Act by Sens. John Fetterman (D-Pa.), Cory Booker (D-N.J.) and Tammy Baldwin (D-Wisc.) would lower the safe harbor dollar amount for late fees to $8, limit future changes to inflation adjustments only and direct future challenges to the D.C. Circuit Court to avoid lawsuits being heard in “ultra-right-wing 5th Circuit Court,” according to a summary of the bill by the sponsors.
The bill is endorsed by several consumer advocacy groups.
The late fee rule was implemented under former CFPB Director Rohit Chopra. ABA joined the U.S. Chamber of Commerce and other plaintiffs in challenging the rule, arguing the bureau exceeded its statutory authority. The bureau last year reached an agreement with the plaintiffs acknowledging that it exceeded its authority under the Credit Card Accountability Responsibility and Disclosure Act, and that the rule violated the Administrative Procedure Act. The parties asked the court to vacate the final rule.
