Protecting consumers

Overdraft fees | All those hidden fees |
Private student loan practices | Credit reports | Know before you owe | Prepaid card fraud

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A cornerstone of the new law is the creation of the Consumer Financial Protection Bureau (CFPB). The CFPB is the first federal financial regulator with only one job, protecting consumers. It has authority over any firm – bank or non-bank – selling financial products. The new bureau exists to ensure that existing laws are enforced that protect you from deceptive and unfair banking practices. For years, many of those laws have gone unenforced because consumer protection was not a priority for the government. The CFPB is finally making consumer protection a priority.

Because the CFPB is brand new, it is currently asking the public for input into what consumer problems it ought to prioritize. Below are some common consumer problems that OSPIRG Foundation thinks the agency ought to focus on.  Learn more about the CFPB and about CFPB Director Richard Cordray.

Rein in overdraft fees

Problem: The good news is that banks may no longer automatically enroll you in so-called “standard overdraft protection” programs without your consent. Unfortunately, many banks still try to trick consumers into signing up for this overdraft protection without fully explaining the consequences, or the alternative less-expensive products. Worse, without your knowledge, banks can change the order in which your checks and debits are cleared in order to increase the chance that you overdraft (see how the sceme works with this interactive tool).

Solution: Require banks to be more up front with consumers about the potential negative consequences of overdraft protection; and ban check re-ordering schemes.

Learn more: Time Magazine, 1/3/12, We Paid Almost $30 Billion in Overdraft Fees in 2011.

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Disclose all those hidden fees

Problem: Banks are required by a 1991 law, the Truth In Savings Act, to disclose all of their fees to anyone who asks.  However, in a recent OSPIRG Foundation study conducted nationally, nearly one quarter of banks surveyed never complied with the law, even when asked several times. Only 38% easily complied; just over half eventually complied. Consumers cannot shop around if fees are hidden. Moreover, it is very difficult for consumers to make an apples-to-apples comparison of fees between different banks or to compare fees on the Internet because the law only applies to paper brochures at the bank.

Solutions: The CFPB should:

  • Enforce the Truth In Saving Act: Routinely audit bank fee disclosure practices from time to time and impose penalties for banks that violate the law.
  • Require banks to disclose their fees and account rules in a easy to read and consistent format (Similar protections were enacted for credit cards in 1988).
  • Extend the law to the Internet.
  • Require Internet fee disclosures to be available in a machine readable format so that online aggregators can automatically publish localized shopping guides for consumers.

Learn more: OSPIRG Foundation, 4/2/11, Big Banks, Bigger Fees

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Rein in unfair private student loan practices

Problem: Private student loan companies sometimes lead some parents and students into taking out expensive private loans even while they are eligible for less expensive federal loans and grants.

Solution: Before a private lender can make a student loan, the student must have the opportunity for a consultation by her college's financial aid officer. This would help ensure that students and parents maximize all of their less-expensive federal aid before turning to private loans.

Learn more: The Institute for College Access and Success (TICAS), 12/22/11, Risky Private Student Lending on the Rise Again. See also TICAS' letter to the CFPB on private student loans.

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Give consumers more control over their credit report

Problem: Even if you've never missed a bill or payment, an error on your credit report — including one caused by identity theft – can mean you're denied for a loan or pay higher interest rates.

There are thousands of banks, yet just three large credit bureaus control nearly all Americans' credit reports. A recent OSPIRG Foundation study found that nearly one-quarter of credit reports had serious errors, including false delinquencies.

Credit bureaus have never been fined for these errors; and have only been fined three times at all. Once, in 2000, the FTC fined all three of them for not having enough people to answer the phones. Twice since then, the credit bureau Experian has been fined for deceiving customers into thinking that its expensive credit monitoring products are actually “free credit reports.”

Solution: The CFPB should use their authority to routinely audit the internal practices of the credit bureaus and require them to improve the accuracy of their records. In addition, the CFPB should mandate that consumers get their credit scores for free, just like federal law allows them to get their credit reports for free. 

Learn more: OSPIRG Foundation, Mistakes Do Happen: A Look At Errors in Consumer Credit Reports

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Know before you owe

Problem: Credit card, student loan and mortgage contracts are mind-numbingly long and complex. It can be difficult for you to know what you are getting yourself into.

Solution: Credit and loan agreements ought to be simpler  – and help you be crystal clear what you are getting yourself into.

Take action: Tell the CFPB what you think about their ideas for better student loan disclosure, simpler credit card contracts or simpler home mortgage agreements.

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Protect prepaid and reloadable card users from fraud

 Problem: Many consumers think that all plastic carries the same protections from fraud. Unfortunately, that is not the case.

Credit card customers have strong protections against fraud and identity theft. If your credit card is stolen, your maximum liability is $50 no matter when you discover the fraud, and you have numerous avenues to dispute billing errors. Debit cards linked to your checking account have slightly less protections; your liability is just $50 only if you report fraud within 2 days, goes up to $500 if you report within 60 days, and is unlimited if you report beyond that. All other forms of plastic, including reloadable and prepaid cards (including campus cards) have no liability limits.

Solution: Ideally, all forms of plastic money should have the same protections as credit cards. That, unfortunately, will require Congressional approval and is unlikely at the moment.

The next best thing would be to give all prepaid and reloadable cards the same protections from fraud as bank debit cards. Fortunately, the CFPB has the power to do this without Congressional approval. This would not only give prepaid card users liability protection, but would also allow those consumers to receive free balance and transaction information about their accounts in order to monitor unauthorized charges, unwanted fees and errors; have all fees clearly disclosed up front at the point of sale.

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Issue updates

News Release | U.S. PIRG Education Fund | Consumer Protection

Deadly infant products sold after recalls at T.J. Maxx, Marshalls, HomeGoods

The U.S. Consumer Product Safety Commission (CPSC) announced today that discount stores T.J. Maxx, Marshalls and HomeGoods sold 19 different recalled products to consumers between 2014 and 2019. In the case of five products, the stores’ parent company TJX initiated the recall. The products included the Rock ‘N Play and Kids II inclined infant sleepers, which are responsible for a number of fatalities, rattles that can break and pose a choking hazard, and electronics that overheat or explode.

> Keep Reading
News Release | U.S. PIRG Education Fund | Consumer Protection

Heartburn medication recalls continue due to carcinogen concerns

The U.S. Food and Drug Administration (FDA) has confirmed today that the drug manufacturers Dr. Reddy’s and Perrigo have initiated a voluntary recall of all of their generic versions of Zantac (ranitidine) -- commonly used to treat heartburn -- due to carcinogen contamination.

> Keep Reading
News Release | U.S. PIRG Education Fund | Consumer Protection

Proposed rule would remove unsafe, inclined infant sleepers from market

Despite more than 50 infant deaths from inclined sleepers, including the Fisher-Price Rock ‘n Play and the Kids II Rocking Sleeper, many versions of this type of product remain for sale and in homes. The U.S. Consumer Product Safety Commission (CPSC) is proposing a new rule that would virtually end the sale of inclined sleepers. 

> Keep Reading
News Release | U.S. PIRG Education Fund | Public Health, Consumer Protection

New analysis uncovers unsafe blood pressure medication distributed in US

A new analysis of publicly available information from the FDA by U.S. Public Interest Research Group Education Fund finds only 26 percent of a class of recalled blood pressure medications have been assessed for carcinogen contamiantion -- and the majority had some lots with higher levels than the FDA considers safe.

> Keep Reading

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News Release | U.S. PIRG Education Fund | Consumer Protection

Proposed rule would remove unsafe, inclined infant sleepers from market

Despite more than 50 infant deaths from inclined sleepers, including the Fisher-Price Rock ‘n Play and the Kids II Rocking Sleeper, many versions of this type of product remain for sale and in homes. The U.S. Consumer Product Safety Commission (CPSC) is proposing a new rule that would virtually end the sale of inclined sleepers. 

> Keep Reading
News Release | U.S. PIRG Education Fund | Public Health, Consumer Protection

New analysis uncovers unsafe blood pressure medication distributed in US

A new analysis of publicly available information from the FDA by U.S. Public Interest Research Group Education Fund finds only 26 percent of a class of recalled blood pressure medications have been assessed for carcinogen contamiantion -- and the majority had some lots with higher levels than the FDA considers safe.

> Keep Reading
News Release | U.S. PIRG | Consumer Tips, Consumer Protection

Largest bank hack ever, of Capital One, exposes 100 million to identity theft

Everyone should assume that their social security number has been exposed between this breach and breaches of other major companies’ databases, such as Equifax’s. With that in mind, U.S. PIRG recommends all Americans should use their right by law to freeze their credit reports for free

> Keep Reading
News Release | U.S. PIRG Education Fund | Consumer Protection, Financial Reform

Equifax penalty is a “sweetheart deal” that leaves consumers at risk

Our response to Equifax paying a $650 million penalty for exposing the social security numbers of 148 million Americans to identity theft.

> Keep Reading
News Release | U.S. PIRG Education Fund | Consumer Protection

Fisher-Price recalls nearly 5 million potentially deadly Rock n’Play sleepers

Fisher-Price recalled 4.7 million Rock n’Play baby sleepers on Friday. U.S. PIRG Consumer Watchdog Adam Garber issued a response: "“While we’re pleased that Fisher-Price is finally recalling these dangerous sleepers, 30 deaths in 10 years is 30 deaths too many and 10 years too late."

> Keep Reading

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Report | OSPIRG | Consumer Protection

Trouble in Toyland

The 2012 Trouble in Toyland report is the 27th annual OSPIRG survey of toy safety. In this report, OSPIRG provides safety guidelines for consumers when purchasing toys for small children and provides examples of toys currently on store shelves that may pose potential safety hazards.

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Big Banks, Bigger Fees

Since Congress largely deregulated consumer deposit (checking and savings) accounts beginning in the early 1980s, the PIRGs have tracked bank deposit account fee changes and documented the banks’ long-term strategy to raise fees, invent new fees and make it harder to avoid fees. 

> Keep Reading
Report | OSPIRG Foundation | Consumer Protection, Financial Reform

10 Reasons We Need The CFPB Now

This report outlines predatory financial practices that hurt consumers and helped collapse the economy, and details “10 Reasons We Need The Consumer Financial Protection Bureau Now.”

> Keep Reading
Report | OSPIRG Foundation | Consumer Protection, Financial Reform

Tricks and Traps

As Oregonians continue to endure the worst economic crisis since the Great Depression, OSPIRG set out to discover what consumers are really paying to maintain basic banking services in Oregon, and what sorts of fees and financial institution policies have the biggest effect on consumers' bottom line.

> Keep Reading
Report | OSPIRG Foundation | Financial Reform

Mistakes Do Happen

The most valuable thing we have is our good name. The most common reflection of our reputation as a trustworthy consumer is our credit report. Unfortunately, the information contained in our credit reports, which are bought and sold daily to nearly anyone who requests and pays for them, does not always tell a true story.

> Keep Reading

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News Release | US PIRG

Beech-Nut will stop selling all single grain rice cereal after Alaska state officials discovered high arsenic levels during routing sampling, the U.S. Food & Drug Administration (FDA) said in a statement released Tuesday.

News Release | US PIRG

The U.S. Consumer Product Safety Commission approved tough new standards Wednesday to regulate several infant sleep products for the first time.

News Release

Being a consumer is a tough job. Really tough. During National Consumer Protection Week, which runs through March 6, the U.S. PIRG Education Fund staff is offering a daily dose of tips and advice to help you navigate life’s biggest consumer challenges.

News Release | OSPIRG Foundation

PORTLAND --  OSPIRG Foundation's Trouble in Toyland report has helped identify dangerous toys for 35 years. But 2020 is unique, and as Americans have worked, learned and played from home to protect themselves from COVID-19, children could be more susceptible to certain toy-related hazards. 

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Priority Action

Use the form below to share with CFPB Director Richard Cordray what you think their priorities ought to be.

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