IMGCAP(1)]
Lawmakers are not expected to drop proposed overdraft-protection legislation, despite the Federal Reserve Board last week issuing new rules requiring banks to adopt opt-in policies for overdraft protections tied to debit card purchases and ATM transactions (CardLine, 11/13), reports Credit Union Journal, a CardLine sister publication. The credit-union lobby is urging Congress to wait before acting on overdraft-protection legislation until more is known about the impact of the Fed's new rules, which take effect July 1. Rep. Carolyn Maloney, D-N.Y., and Sen. Dodd, D-Conn., "don't want to wait. They want to move forward," John Magill, chief lobbyist for the Credit Union National Association, said yesterday regarding separate proposals in the House and Senate that would go further than the Fed's rules by adding several additional restrictions. Maloney's House bill would limit how many times issuers could impose overdraft fees to no more than one per month and six per year, and it would restrict the charges to what is "proportional" to covering the cost of the overdraft. The bill, which the House Financial Services Committee could vote on as soon as this week but likely will hold off doing so until after Thanksgiving, also would require opt-in for all overdraft protections and prevent credit unions and banks from ordering payments based on their amounts instead of when the overdrafts occurred. Dodd's bill before the Senate Banking Committee also would limit the amount and number of overdraft charges. Dodd, the committee's chairman, was to hold a hearing on the overdraft issue today.
