Junk fees – those hidden and bogus charges that have found their way into a wide variety of transactions – are on consumers’ minds. After receiving more than 12,000 comments about how these fees impact consumers and businesses, the FTC announced on Oct. 11, a proposed rule on deceptive fees. It's now looking for further feedback.
It’s heartbreaking. I’ve seen young people sign up for for-profit colleges and they use their laptops to complete the courses. They expect great things from the programs they choose. However, the results are usually poor, despite what the advertising says. Most colleges will give you a valuable education that can help you achieve your career goals.
Equifax, Experian, and TransUnion – the three national credit reporting agencies – are permanently extending a program that lets you check your credit report at the agencies once a week for no cost. Visit AnnualCreditReport.com to request free copies of your credit reports, the Federal Trade Commission advises. Other sites may charge you or be fraudulent.
Junk fees are everywhere. The fees, which cost American families tens of billions of dollars each year, can strain any family budget. The Consumer Financial Protection Bureau, which looks for junk fees when it examines financial institutions, found the following during its reviews between February and August 2023:
Paying off student loans is bad enough without being ripped off by a dishonest company. Some companies pretend to be affiliated with the Department of Education, charge illegal junk fees, and lure students with repayment programs and loan forgiveness that don’t exist. The FTC is banning two student loan debt relief companies for these illegal activities
About a year ago, I got the idea that I needed to transfer my emergency fund of $20,000 from the local credit union where it was in a money market fund because the yield was low, 0.54 percent. In a year, the dividends paid were $49.32. I finally got around to it in July. After research, I selected a money market mutual fund at Vanguard.
Many people get caught up in credit card debt. In 2022, Americans increased their credit card debt by a record $179.4 billion. The total owed by credit-card holders now is more than $1.1 trillion. However, people in some states charge less on their credit cards than others. WalletHub takes a look at the issue in a report.
Bank of America to pay $250 million for illegally charging junk fees, withholding credit cards rewards, and opening fake accounts
Another big bank is being exposed for corporate fraud. Bank of America will pay more than $100 million to customers for double-dipping on fees imposed on customers with insufficient account funds, withholding reward bonuses promised to credit card customers, and misusing personal information to open accounts without customers’ knowledge.
Another large financial institution has been caught gouging customers. Raymond James agreed to settle allegations Tuesday with six state securities regulators for charging unreasonable commissions on trades that harmed investors. The broker-dealer will pay at least $8.2 million in refunds to clients, and $4.2 million in penalties and costs.
Financial institutions are increasingly using chatbots, which put out human-like responses using computer programming, to communicate with customers to save money. Chatbots sometimes have human names and use popup features to encourage interaction. Some chatbots use more complex technologies such as “artificial intelligence” to respond to customers.