Released: October 20, 2009

Bill to limit automatic overdrafts, fees

Source: Kathy Chu, USA Today (Free Registration)

Leading Democrats introduced legislation Monday to rein in banks’ widespread practice of automatically paying overdrawn transactions, then charging customers a steep fee.

The bill, sponsored by Senate Banking Committee Chairman Chris Dodd, D-Conn., will require banks to get customers’ consent before paying ATM and debit card transactions, limit the number of overdraft fees charged and tie the fees to banks’ processing costs.

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