Each year, banking customers spend an estimated $32 billion on overdraft fees. While many banks have modified their policies regarding the costly fees, recent reports found those changes aren’t enough to protect most consumers. Now, in an effort to add to those protections, one lawmaker is pressing banks for more information on their policies.

New Jersey Senator Cory Booker sent letters [PDF] to 13 major U.S. banks Monday asking for information about their current overdraft-fee programs and the institutions’ push to have customers enroll in so-called “overdraft protection” programs.

“I’m concerned that too many of our nation’s banks are increasingly driven to accumulate these fees, rather than pursue a business model that serves their communities,” Booker wrote in the letter.

Looking For Answers

Booker said Monday that his letter seeks to uncover additional information about overdraft practices from 13 banks, including Chase Bank, Wells Fargo, Bank of America, TD Bank, PNC Bank, SunTrust Bank, Regions Bank, Branch Banking and Trust (BB&T), Woodforest Bank, Ameris Bank, Bank Plus, U.S. Bank, and Ocean Bank.

These banks, Booker says, represent the top 10 U.S. banks in overdraft and non-sufficient-funds revenue, as well as the U.S. banks with over $2 billion in assets that take in the most overdraft and non-sufficient-funds revenue per account.

The letters ask the banks to provide information on how much the bank depends on overdraft fees for revenue, how many new customers opt-in to overdraft protection, what type of incentives employees are given to boost enrollment in overdraft programs, and the process by which consumers opt-in to such programs.

Booker gave the banks until Aug. 11 to respond to the letters.

Overdraft Issues

Booker cites a 2014 Pew study that found more than half of the customers who overdrew their checking accounts, incurring a fee, did not remember consenting to overdraft service.

Under federal law, depository institutions are prohibited from charging overdraft fees on ATM and one-time debit card transactions unless consumers affirmatively opted in. If customers don’t opt in, banks may decline the transaction because of insufficient or unavailable funds, and can’t charge an overdraft fee.

However, recent enforcement action from federal regulators shows that not all banks have followed these rules.

Back in January, the Consumer Financial Protection Bureau accused TCF Bank of tricking customers into its costly overdraft program by obscuring fees and creating loose definitions of consent.

TCF Financial, which operates 376 branches in Illinois, Minnesota, Michigan, Colorado, Wisconsin, Arizona, South Dakota, and Indiana, operates an overdraft program much like those at other financial institutions, charging on average $35 every time a customer overdrafts by spending or withdrawing more money than is available in their account.

Prior to that action, the CFPB in July 2016 fined Santander Bank $10 million for alleged illegal overdraft practices. The fine came after the CFPB accused the company’s telemarketing vendor of deceptively marketing an overdraft service and signing certain bank customers up for the service without their consent.

Booker notes in the letter that he’s worried that such deceptive overdraft practices are “undermining trust in our nation’s bank, leading many consumers to abandon banks altogether after seeing their saving drained by fees.”

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