July 10, 2012
H.R. 4367 eliminates the unnecessary and duplicative disclosure of ATM fees and helps prevent frivolous lawsuits against community banks.
The Electronic Funds Transfer (EFT) Act requires ATM operators to provide two separate notices regarding ATM fees (i.e., a placard placed on the ATM machine and a separate disclosure on the video screen). The video screen fee disclosure requires the user to accept the fee - or not. If the user accepts the fee the transaction proceeds. If the fee is declined the transaction is cancelled and the fee is not charged. Community banks fully support the consumer protection of video screen fee disclosure.
Issues however have arisen with the placard on the ATM machine. Penalties for not displaying the placard are severe (i.e., the lesser of $500,000 or 1% of the net worth of the ATM operator) and have unfortunately provided an incentive for ATM vigilantes to remove the placard and file frivolous lawsuits. During the last 18 months these lawsuits have increased, and if the situation is left unchecked ATM operators may be forced to remove ATMs which will result in reduced consumer convenience. Several CBAI members have reported these problems, and more such instances will likely occur in the future unless this common sense legislation is passed.
The House Financial Services Committee recently reported this legislation to the entire House of Representatives by a voice vote. Yesterday, the House approved this legislation by a wide bipartisan margin (371 “yea”, 0 “nay” with 60 members “not voting”).
CBAI thanks the Illinois members who voted in favor of passage and particularly those members who were proactive and cosponsored this important legislation: Dan Lipinski (D-3rd), Luis Gutierrez (D-4th), Mike Quigley (D-5th), Peter Roskam (R-6th), Robert Dold (R-10th), Judy Biggert (R-13th), Don Manzullo (R-16th), and John Shimkus (R-19th).
CBAI encourages the U.S. Senate to quickly pass this important legislation.