President Biden will announce Wednesday a push to cap credit card late fees and urge Congress to rein in “junk fees” tied to travel, concerts and other industries, the White House said.
Mr. Biden will direct the Consumer Financial Protection Bureau to propose a rule that slashes credit card late fees from an average of $30 to $8. The White House estimates that customers will pay $9 billion less in late fees per year.
Additionally, Mr. Biden will use the fourth meeting of the President’s Competition Council on Wednesday to call for the passage of a Junk Fee Prevention Act that targets four types of junk fees, the White House said:
• Excessive fees for concerts and sporting events — such as “processing,” “delivery” and “facility” fees — that are not disclosed upfront but can average more than 20% of the ticket’s face value.
The move coincides with widespread angst over monopolies that ticket companies have at many entertainment venues, making it impossible to avoid fees or other hassles.
• Airline fees that force family members to pay to select a seat in advance so that parents and children are matched in aisles.
The Department of Transportation issued a notice last year saying children 13 or younger must be seated next to their parents at no extra charge, but Mr. Biden wants legislation to fast-track and shore up the ban.
• Cable, TV and internet fees that consumers face if they terminate their services early because they want to use a different provider.
The White House said the fees can exceed $200, make it hard for competitors to gain a foothold in the market and “charge people when they’re most vulnerable — people who are forced to move because of a job loss or other financial downturn, for example, may be slammed with hundreds of dollars in early termination fees.”
• Resort or “destination” fees that can be $50 or more per night and show up when families check out at the end of a lengthy reservation process.
The White House says the fees are increasingly common and that more than one-third of hotel guests report having paid such fees.
The move will likely receive pushback from impacted industries, though the administration characterized the crackdown as necessary.
“Junk fees are not only costly to consumers, but they can stifle competition by encouraging companies to use increasingly sophisticated tools to disguise the true price consumers face,” a White House fact sheet says. “By reducing these fees and increasing transparency, we can provide relief to consumers and make our economy more competitive, particularly for new and growing businesses.”
Mr. Biden’s call for a fee crackdown is part of a broader attempt to inject competition into markets.
In a notable move, he previously implemented rules that allow certain hearing aids to be sold over the counter, saying consumers would save money because they wouldn’t need more costly devices prescribed by a specialist.
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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