Lake Worth lawmaker wants to ban bank debit-card fees
by Dara Kam | October 17th, 2011Rep. Jeff Clemens, a Lake Worth Democrat, has filed a bill that would ban banks from charging customers for using debit cards.
The bill (HB 375) doesn’t have a Senate sponsor and the GOP-dominated legislature is unlikely to pass the measure. Clemens filed his bill on Monday, capitalizing on recent protests by Occupy Wall Street supporters, who held rallies throughout the world this weekend, including in Lake Worth.
“The banks sold us all on the idea of a cashless society, and now that we’ve bought into their promise of free, easy access to our own money, they want to charge us for it,” Clemens, who served as Lake Worth mayor before coming to Tallahassee, said in a statement. “Anyone with a sense of decency should be outraged.”
Clemens’ proposal makes it unlawful “to charge or impose a dormancy fee, and inactivity fee or charge, or a service fee with respect to the use or holding of a debit card by a consumer.”
Wells Fargo and Bank of America, the first banks to announce monthly fees for debit cards, are raking in huge profits, according to Clemens. Bank of America has paid no federal income tax for the past two years, claiming losses in its federal filings and is planning to eliminate 30,000 jobs. Wells Fargo netted more than $7.5 billion in profits during the first half of this year, Clemens said.
Federal laws govern banking regulations but Clemens said a recent U.S. Supreme Court that gave the New York attorney general oversight over some federally chartered financial institutions.
Representative Clemens has also started a Facebook page entitled G.R.E.E.D. (Get Rid of Excessive Expenses for Debitcards) that he hopes will serve as a sort of rallying point for those who are outraged and a clearinghouse for banking horror stories.
Clemens said he also started a Facebook page called “Get Rid of Excessive Expenses for Debitcards,” or G.R.E.E.D. to “serve as a rallying point for those who are outraged and a clearinghouse for banking horror stories,” according to the release.
Tags: banking, debit cards, Florida House, Jeff Clemens, Occupy Wall Street
October 17th, 2011 at 1:26 pm
Mr. Clemens and his proposed legislation miss the point. The banks, Republicans and many voters warned that if the Dodd-Frank bill and Senator Durbin’s ill-conceived amendment – which limited the fees banks could charge RETAILERS for accepting debit cards – passed that the cost would be passed on to customers. Surprise! The banks did exactly that. Senator Durbin’s response? He went to the floor of the US Senate and told customers to take their money out of Bank of America.
Mr. Clemen’s response? To make the same error. More government intervention won’t solve the problem, it will only exacerbate it.
The banks, who employ tens of thousands of people, stand to lose $6B a year because of the Durbin amendment. The amend needs to be repealed. In fact, Dodd-Frank needs to be repealed because it doesn’t solve the problems it was supposed to fix, it institutionalizes them.
Mr. Clemens bill is simply an attempt to get his name in the paper (something he’s done a very good job at as a freshman state representative) and to tap into the frustration and socialist sentiments being displayed in the so-called “Occupy Wall Street” movement.
It can’t be a coincidence that a local “Occupy” group had a meeting this past Saturday in Lake Worth, which is Clemens’ home and in his district.
This naive proposal only proves Mr. Clemens’ lack of understanding of basic economic principles and that he is unqualified to hold his position as a state representative.
October 17th, 2011 at 2:24 pm
This bill would do nothing to Bank of America nor Wells Fargo. Both are national banks and therefore not subject to state law in this regard. Good to know we have a lawmaker who doesn’t understand the law.
October 17th, 2011 at 2:26 pm
Nice try, Steven. GOP shills will have you believe that this is somehow the fault of previous legislation regulating the banks.
Instead, have you looked at the bottom line profit of these banks? Have you look at the hundreds of millions of dollars they are handing out in executive bonuses?
These banks aren’t hurting because of federal regulation. They just want obscene profits. And you are playing right into their hands.
I’ll assume you are rich and therefore don’t care about corporations rolling over common people. Because if you’re not, I really can’t find a good explanation for you to defend corporations that make obscene profits and often, as in the case of BofA, don’t even pay federal taxes.
How can anyone of character defend that?
October 17th, 2011 at 2:27 pm
Carl, I think if you will look at some recent case law, you may find differently. Of course, I doubt you will.
October 17th, 2011 at 2:29 pm
Wow, Steven Rosenblum. You really feel sorry for the banks. I can understand that. Your corporate overlords needs all those tens of millions of dollars in stock options.
Hope you’re getting a cut, buddy.
October 17th, 2011 at 2:32 pm
Thank you, Mr. Clemens. It’s about time that someone took a stand with these banks. They told me for years that these debit cards are free and that they are so easy to use. So finally, last year, I stop use my checks and go paperless. And no that they’ve got me, they’re gonna charge me money to have access to MY OWN MONEY. That is disgusting.
Keep up the good work!
October 17th, 2011 at 2:46 pm
In Cuomo v. Clearing House Association, The Supreme Court held 5-4 that state do have the ability to enforce state regulations on banks.
Justice Scalia noted that states “have always enforced their general laws against national banks — and have enforced their banking-related laws against national banks for at least 85 years.”
This case was most interesting in that Scalia and Ginsburg were both in the majority.
Anyway, it is a commonly held misconception that states can’t regulate federal banks, so I can see how one would make that mistake.
October 17th, 2011 at 3:04 pm
I’m not rich, far from it. I don’t work for or receive any compensation from banks. And trying to turn this on me won’t make your weak arguments any more true. But… Nice try.
October 17th, 2011 at 3:06 pm
Oh and I don’t feel sorry for the banks. But I do feel sorry for the employees of the banks that will lose their jobs if Clemens’ bill were to pass.
October 17th, 2011 at 3:13 pm
Steven, do you think any of those employees who will lose their jobs will be making seven figures?
Of course not.
So according to your argument, we should just let the banks do whatever they like, otherwise they’ll fire people.
Under that premise, we’d still have child labor. Nice.
October 17th, 2011 at 3:41 pm
The swipe fee debate was big banks vs. big retailers. Retailers “promised” that if swipe fees were capped they would reduce prices accordingly, guess what the retailers lied, and they can’t reduce costs b/c the swipe fee cap doesn’t apply to credit cards so the cost associated with credit cards is still built into the price of goods regardless of whether you use cash or debit.
Those of us who are trying to be responsible with our finances, by avoiding debt, are likely to be punished. BOA, the big bank pushing debit card fees the most, have the most to gain becuase they are the biggest credit card company, push people from debit to credit, they make more money.
It all seems to be a vast conspiracy by corporate giants and their minions in congress (in both parties) to screw the average American.
October 17th, 2011 at 4:29 pm
Just go to another bank. You can’t micromanage everything nor should we.
October 17th, 2011 at 4:58 pm
Beat them at their own game. Use your debit card as a credit card and pay the balance in full each month. That way you get no fees and no interest charges.
October 17th, 2011 at 5:55 pm
rpg, I hear you about going to another bank. But what happens when this becomes an accepted practice and every bank follows suit?
The bottom line is that banks promised us easy access to our own money and convinced us to stop carrying cash and checks. And now they want to make ridiculous profits, not just reasonable ones. So they will blame whoever else they can (retailers, Congress, etc.).
But we know better. We bailed them out, while they continues to pay out big bonuses, and this is the thanks we get.
Way to go, Rep. Clemens!!
October 17th, 2011 at 6:02 pm
Before we start railing against BofA’s $5 fee or any other of the new fees that big banks have been introducing lately, we should consider what got us at this situation in the first place. All of these reviled fees are in response to the fall in revenues from debit card transactions that are the consequence of the passing of the Durbin Amendment and the Federal Reserve ruling to cap debit interchange at $0.22 + 0.05% of the transaction amount.
Everyone who was paying attention to what was happening knew that this was coming and warned against it. Here is what we wrote: http://blog.unibulmerchantservices.com/banks-may-limit-debit-card-transaction-size-to-fight-fee-limit
The point is that, if the government decides that a large portion of a business’ revenues would be collected by someone else, the business will look for ways to make up for its losses and they would do it any way they can. Banks are certainly no different.
October 17th, 2011 at 7:49 pm
Sorry, J.G., but that is just bank propaganda.
Banks are making money faster than you can say “bigger fees!”
And Bank of America didn’t even pay corporate taxes the last two years.
The bank sob story is a ridiculous and no one should be buying it. Every business has a right to a profit. But at what point is it wrong for them to take taxpayer money, lavish executives with huge bonuses, and then turn around and give the bill to consumers in the form of higher fees?
This is too much, and we should all direct our anger where it belongs – the banks!
October 17th, 2011 at 9:54 pm
> Beat them at their own game. Use your debit card as a credit card and pay the balance in full each month. That way you get no fees and no interest charges.
Kevin, I called Bank of America and asked if that would avoid the “debit card” fee – and they said no, you’ll still be charged the $5 a mo. fee regardless of whether you use it as debit or credit. It isn’t a true credit card, it is tied directly to your bank account.
I called PNC out of curiosity and looked at their website, and they seem to offer everything bank of america does but they said they are not going to charge a $5 fee. I heard they are promoting this decision not to charge, hoping to get customers who leave Bank of America and other banks.
October 17th, 2011 at 9:57 pm
> Beat them at their own game. Use your debit card as a credit card and pay the balance in full each month. That way you get no fees and no interest charges.
Kevin, I called BofA with the same idea and they said they will charge no matter which way you use it, debit or credit.
Out of curiosity I called PNC and they seem to have everything Bank of America has and they assured me they do not intend to charge to use their card.
October 18th, 2011 at 12:13 pm
Clemens, what a good little socialist.
WHO IS JOHN GALT?
October 19th, 2011 at 6:56 am
Many of these banks have exclusive contracts and branches on universities and colleges that students must use for direct deposit of scholarships, Bright Futures, and Prepaid funds and then preauthorized automatic tuition withdrawals and campus transactions. Are these requirements by colleges and universities legal or are the banks waiving all fees for the contracts?
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