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$35 overdraft fee with that $4 latte? Hearing today.
By Ed Mierzwinski - 10/30/2009 We've signed onto testimony by Jean Ann Fox of the Consumer Federation of America, to be delivered this morning at a hearing (other testimony is here) of the House Financial Services Committee. A markup vote will occur next week. Several of our consumer colleagues, from CRL and Consumers Union, will testify and are joined by a witness from the North Carolina State Employees Credit Union -- one of the good credit unions that doesn't copycat the banks and gouge its member-customers with unfair overdraft protection fees. In addition to these witnesses, a veritable parade of industry witnesses will attempt to answer the questions:
  • Why do banks impose overdraft protection fees without asking consumers to apply and consent to it?
  • Why have banks and credit unions switched the default to allow debit overdrafts in online point of sale transactions, when they could reject them instead and save consumers $35 on a $4 latte?
  • Why do some regulators allow banks and credit unions to mislead consumers about their actual balances by including the amount they are allowed to overdraft in ATM machine balance inquiries?
  • Why do some banks and credit unions change the order that they clear checks and debits, so more will bounce?
  • Why do banks call this a customer benefit, not a penalty fee?Our most recent testimony on overdraft fees is here.
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    • PIRG: A dirty dozen powerful interests slowing tax reform
    By Ed Mierzwinski - 10/29/2009 A new U.S. PIRG report called Who Slows the Pace of Tax Reforms? profiles a dozen powerful corporations that have signed onto one or more letters from the PACE coalition, a group that stridently opposes international tax reform. The report shows how this “dirty dozen” benefits from lucrative federal contracts, yet do not pay their fair share of taxes and spend heavily to block tax reform. (Here is the release) Highlights include these facts: • The corporations profiled are twelve of the 100 largest publicly traded U.S. contractors and they received over $10 billion in government contracts in 2008 alone. • The “dirty dozen” maintain over 440 subsidiaries in tax haven countries or financial privacy jurisdictions. • The same dozen corporations spent a collective $37 million for 2008, over $100,000 a day, and over $33 million so far for 2009, on lobbying, while also spending over $6 million (in 2008) in campaign contributions from their political action committees to candidates and parties.The report is by Nicole Tichon, our tax reform advocate, and Lisa Gilbert, our democracy advocate.
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    Don't click on phish-y emails claiming to be from FDIC
    By Ed Mierzwinski - 10/28/2009 Because, they are phishing scams seeking to take your information, then take your money. The FDIC says:
    E-mail Claiming to Be From the FDIC – October 26, 2009 The Federal Deposit Insurance Corporation (FDIC) has received numerous reports of a fraudulent e-mail that has the appearance of being sent from the FDIC. The subject line of the e-mail states: “check your Bank Deposit Insurance Coverage.” [...]This e-mail and associated Web site are fraudulent.
    FULL RELEASE, after the jump.
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    Privacy-intrusive K-12 data collection may be extended to college students
    By Ed Mierzwinski - 10/28/2009 Privacy experts Joel Reidenberg and Jamela Debelak at Fordham Law School's Center on Law and Information Policy have released (their release, their report) an important new study. From Nick Anderson's Washington Post lede in his story States mismanage student information, study concludes:
    States often collect far more information about students than necessary and fail to take adequate steps to protect their privacy, a national study concludes. The dossiers go far beyond test scores, including Social Security numbers, poverty data, health information and disciplinary incidents.
    Reidenberg and Debelek note in their release the troubling finding that the K-12 database may be linked to a new student loan database proposed for college students.
    "Even so, House Bill 3221, or the Student Aid and Fiscal Responsibility Act, contains a section that calls for the expansion and further integration of these databases without addressing these privacy concerns. A Senate version of the bill is expected to be released from committee shortly."
    The release goes on to quote a leading student loan expert on his concerns:
    “The CLIP study meticulously documents the states’ disregard for safeguarding children’s most personal data,” said Barmak Nassirian, Associate Executive Director, American Association of Collegiate Registrars and Admissions Officers. “And yet Congress is poised to fund an ill-thought-through expansion of these systems to include data ranging from pre-birth medical information to education, employment, military, and criminal records.”
    U.S. PIRG experts share the concerns expressed in the report and by Nassirian.
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    New bill on tax dodgers offered
    By Ed Mierzwinski - 10/28/2009 Top House and Senate Democrats have offered new legislation on tax dodges (AP via New York Times). Statement from U.S. PIRG Tax and Budget Reform Advocate Nicole Tichon: New Tax Reform Legislation is a Good First Step Toward Ending Bank Secrecy That Hurts Taxpayers “The Foreign Account Tax Compliance Act of 2009 is a step in the right direction to reform a broken system where tax dodging individuals and corporations offload their burden on ordinary taxpayers. “Holding foreign banks and corporations accountable for their clients can only help the process of ending bank secrecy. However, the bill can certainly be improved by giving the U.S. government even stronger enforcement mechanisms and by taking bold action against offshore shell companies.”
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    Ed Mierzwinski
    U.S. PIRG Consumer Program Director
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