03/08/2010 - In the latest move to overhaul consumer banking practices, the Federal Reserve unveiled a preliminary rule last week to address pesky credit card fees such as late and over-limit charges. The rule — which will be finalized after the public is given a chance to comment — is as notable for what it doesn't do as for what it does.
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In its current form, it won't prevent most card holders from getting hit with steep penalty fees. While the proposal would protect "all card holders from large fees for small over-limit violations, and any card holder with a balance of about $1,700 or less from large late fees, overall that is a minority of card holders," says Nick Bourke, manager of the Safe Credit Cards Project at Pew Charitable Trusts.
Bourke also points out that under the rule, issuers are still allowed to charge penalty fees that equal 100% of the violation.
Read the full article Fed Proposes Rule to Limit Credit Card Fees on USA Today's Web site.
Pew is no longer active in this line of work, but for more information visit the Safe Credit Cards Project on PewHealth.org.