“Fair-Fee” Policy
Taking action to advance President Biden’s competition order, the CFPB is seeking views on fees which it believes exploit consumers by virtue of unfair competition. Although many of the fees it cites are covered by statutory disclosure regimes designed to ensure both front- and back-end fee transparency, the Bureau believes that many of these fees are unfair due to large-bank market power. Unfairness is in part judged by the extent to which a fee exceeds the provider’s marginal cost with some recognition of possible risk, but how much of a profit margin above these break-even thresholds is neither specified nor discussed.