WASHINGTON – A key House panel swiftly approved a bill this morning that would eliminate the Electronic Funds Transfer Act’s requirement that credit unions and banks disclose the fees they charge at the ATM twice—on the outside of the ATM and on-screen—and sent the bill on for a vote of the full House.
The bill says the only disclosure requirement for fees would be on-screen.
Today’s vote comes amid a growing number of consumer suits being filed against credit unions and banks for failure to provide the placard on the machines, with one industry representative estimating as many as 500 such suits have been filed over the past few years.
Rep. Spencer Bachus, R-Ala., chairman of the committee, said the bill will help curb the growing number of class action suits, which threaten access to consumers to ATMs, especially in rural areas where ATM access is remote.
Rep. David Scott, D-Ga., one of the sponsors of the bill, said the current EFTA disclosure requirement is duplicative and consumers will still have access to proper disclosure on-screen if the bill is approved.
Rep. Barney Frank, D-Mass., said the dual disclosure requirement was enacted in 1993 and is now outdated because ATMs are now capable of offering the disclosures on-screen.
Several members of the committee said they were told by credit unions and banks that they have been targeted by unscrupulous consumers who have removed the required placards from the ATMs, then filed class action suit claiming violation of the law.
But the bill, endorsed by the House Financial Services Committee, is expected to have much more heavy opposition when it is debated in the Senate, where it has also been introduced. That’s because of broad opposition by consumer groups, who see the on-machine disclosure as an important consumer protection.