SENATE BILL: Transactions Fairness Act (At Final Vote)

[Southern Senator North Carolina Yankee]

Is that suppose to be annual gross income?

[Southern Senator North Carolina Yankee]

Also why Gross Income?

[lfromnj]

Also why can't an institution have a fee for opening an account?

There are many banks or credit unions one can choose when they want to start. You aren't forced to choose one.

[Vern]

I am not sure I support this. I really don't like the government telling banks what they can charge for. I say let banks make their mind up on that.

[lfromnj]

Also why is there a grace period for credit cards required when there already is a 28-30 day grace period for most banks?

[Southern Senator North Carolina Yankee]

I have PMed Pyro, Tack and Ontario about getting some responses to these questions.

[ON Progressive]

I'll answer more tomorrow, but:

Is that suppose to be annual gross income?

I would imagine that is supposed to be the case, but it would certainly be a good idea to amend this bill to make this explicitly clear, rather than implied.

[Pyro]

Is that suppose to be annual gross income?

It's the same thing. Business Gross Income is annually calculated.

Also why can't an institution have a fee for opening an account?

There are many banks or credit unions one can choose when they want to start. You aren't forced to choose one.

I've already answered this question in the Lincoln thread.

I am not sure I support this. I really don't like the government telling banks what they can charge for. I say let banks make their mind up on that.

Without any regulation, there is nothing in place to prevent financial institutions from nickel-and-diming working families. We need to, at the very least, provide these basic boundaries to protect consumers.

Also why is there a grace period for credit cards required when there already is a 28-30 day grace period for most banks?

In order to set a minimum standard.

[Southern Senator North Carolina Yankee]

Is that suppose to be annual gross income?

It's the same thing. Business Gross Income is annually calculated.

You can calculate Gross Income for any period you want and you can access a penalty for such, be it monthly, quarterly, or annually. This is why I asked and it is why I think it should be specified.

Also why can't an institution have a fee for opening an account?

There are many banks or credit unions one can choose when they want to start. You aren't forced to choose one.

I've already answered this question in the Lincoln thread.

Can we get a link to this perhaps?

I am not sure I support this. I really don't like the government telling banks what they can charge for. I say let banks make their mind up on that.

Without any regulation, there is nothing in place to prevent financial institutions from nickel-and-diming working families. We need to, at the very least, provide these basic boundaries to protect consumers.

Basic boundaries are one thing but there is a legitimate discussion to be had over how far those go and whether these presented here are the appropriate level.

[Southern Senator North Carolina Yankee]

Transactions Fairness Act

to protect consumers from common banking and credit abuse

Be it enacted in both Houses of Congress Assembled,

Section I

1. A financial institution, also known as a banking institution, is defined as a corporation, company or other business entity that provides services as an intermediary of financial markets.

2. A consumer is defined as a person or organization that uses an economic service.

Section II

1. No financial institution shall charge a fee for the following services.

   a. Usage of an Automated Teller Machine, or ATM.

   b. Opening an account.

   c. Closing an account.

   d. Not interacting with the account.

   e. Replacing a lost or stolen credit or debit card.

   f. Stop payment on a check.

   g. Issuing paper statements.

   h. Paying an amount owed through cash, credit or debit.

2. No financial institution shall conduct the following practices.

     a. "Reordering Transactions." This is defined as processing of transactions from a consumer's account in an order that may be different from the order in which the transactions were made.

     b. "Dual Tracking." This is defined as the process in which a mortgage lender may request documents and begin processing a loan modification while simultaneously engaging in the foreclosure process.

3. All financial institutions engaging in credit card services must allocate a minimum five day grace period prior to issuing a late fee for balance payments.

4. In the case of an overdraft or overdrawn account, no fee shall be charged to the consumer until the amount exceeds $50 US. Once the $50 US cap is breached, a fee may be charged to the consumer ten business days following a mailed or electronic notice.

5. Owed funds to a financial institution cannot be collected through the garnishing of Social Security payments.

6. Financial institutions cannot sell or foreclose on real estate without signed authorization from the homeowner.

7. All financial institutions must have a customer service phone line printed clearly on its website home page.

8. Utilities may not charge a fee for the processing of credit or debit cards.

Section III

1. The penalty for failure to abide by the any of the above guidelines shall be no less than:

  a. If a Corporation, Limited Liability Company or Partnership with Gross Income under $10 Billion: 20% of the annual Business Gross Income.

  b. If a Corporation, Limited Liability Company or Partnership with Gross Income over $10 Billion: 40% of the annual Business Gross Income.

Section IV

1. This act takes effect on October 1st, 2019 contingent upon signing by the president.

People's Regional Senate
Pending

[Southern Senator North Carolina Yankee]

Transactions Fairness Act

to protect consumers from common banking and credit abuse

Be it enacted in both Houses of Congress Assembled,

Section I

1. A financial institution, also known as a banking institution, is defined as a corporation, company or other business entity that provides services as an intermediary of financial markets.

2. A consumer is defined as a person or organization that uses an economic service.

Section II

1. No financial institution shall charge a fee for the following services.

   a. Usage of an Automated Teller Machine, or ATM.

   b. Opening an account.

   c. Closing an account.

   d. Not interacting with the account.

   e. Replacing a lost or stolen credit or debit card.

   f. Stop payment on a check.

   g. Issuing paper statements.

   h. Paying an amount owed through cash, credit or debit.

2. No financial institution shall conduct the following practices.

     a. "Reordering Transactions." This is defined as processing of transactions from a consumer's account in an order that may be different from the order in which the transactions were made.

     b. "Dual Tracking." This is defined as the process in which a mortgage lender may request documents and begin processing a loan modification while simultaneously engaging in the foreclosure process.

3. All financial institutions engaging in credit card services must allocate a minimum five day grace period prior to issuing a late fee for balance payments.

4. In the case of an overdraft or overdrawn account, no fee shall be charged to the consumer until the amount exceeds $50 US. Once the $50 US cap is breached, a fee may be charged to the consumer ten business days following a mailed or electronic notice.

5. Owed funds to a financial institution cannot be collected through the garnishing of Social Security payments.

6. Financial institutions cannot sell or foreclose on real estate without signed authorization from the homeowner.

7. All financial institutions must have a customer service phone line printed clearly on its website home page.

8. Utilities may not charge a fee for the processing of credit or debit cards.

Section III

1. The penalty for failure to abide by the any of the above guidelines shall be no less than:

  a. If a Corporation, Limited Liability Company or Partnership with Gross Income under $10 Billion: 20% of the annual Business Gross Income.

  b. If a Corporation, Limited Liability Company or Partnership with Gross Income over $10 Billion: 40% of the annual Business Gross Income.

Section IV

1. This act takes effect on October 1st, 2019 contingent upon signing by the president.

People's Regional Senate
Pending

Sponsor Feedback: Needed
Status: Waiting for Feedback

[ON Progressive]

The amendment is friendly.

[Southern Senator North Carolina Yankee]

Transactions Fairness Act

to protect consumers from common banking and credit abuse

Be it enacted in both Houses of Congress Assembled,

Section I

1. A financial institution, also known as a banking institution, is defined as a corporation, company or other business entity that provides services as an intermediary of financial markets.

2. A consumer is defined as a person or organization that uses an economic service.

Section II

1. No financial institution shall charge a fee for the following services.

   a. Usage of an Automated Teller Machine, or ATM.

   b. Opening an account.

   c. Closing an account.

   d. Not interacting with the account.

   e. Replacing a lost or stolen credit or debit card.

   f. Stop payment on a check.

   g. Issuing paper statements.

   h. Paying an amount owed through cash, credit or debit.

2. No financial institution shall conduct the following practices.

     a. "Reordering Transactions." This is defined as processing of transactions from a consumer's account in an order that may be different from the order in which the transactions were made.

     b. "Dual Tracking." This is defined as the process in which a mortgage lender may request documents and begin processing a loan modification while simultaneously engaging in the foreclosure process.

3. All financial institutions engaging in credit card services must allocate a minimum five day grace period prior to issuing a late fee for balance payments.

4. In the case of an overdraft or overdrawn account, no fee shall be charged to the consumer until the amount exceeds $50 US. Once the $50 US cap is breached, a fee may be charged to the consumer ten business days following a mailed or electronic notice.

5. Owed funds to a financial institution cannot be collected through the garnishing of Social Security payments.

6. Financial institutions cannot sell or foreclose on real estate without signed authorization from the homeowner.

7. All financial institutions must have a customer service phone line printed clearly on its website home page.

8. Utilities may not charge a fee for the processing of credit or debit cards.

Section III

1. The penalty for failure to abide by the any of the above guidelines shall be no less than:

  a. If a Corporation, Limited Liability Company or Partnership with Gross Income under $10 Billion: 20% of the annual Business Gross Income.

  b. If a Corporation, Limited Liability Company or Partnership with Gross Income over $10 Billion: 40% of the annual Business Gross Income.

Section IV

1. This act takes effect on October 1st, 2019 contingent upon signing by the president.

People's Regional Senate
Pending

Sponsor Feedback: Friendly
Status: Senators have 24 hours to object

[Kingpoleon]

I’m not sure if any of you are aware of this, but if you lower the revenue for banks, they will engage in behaviors to re-coup this money. Ideally, that would be investments increasing, but, realistically, without some sort of interest freeze, perhaps a limited freeze that phases this in, banking institutions will almost certainly raise interest rates on loans, mortgages, et cetera.

Furthermore, the current language seems to exclude credit unions from these rules - is that intentional? Because if so, the likely interest hike above will send consumers moving, probably on a larger scale than you might think, to the credit unions instead of banks.

To me, it makes far more sense to designate banking institutions based on fees, in at least three categories, so people can clearly see what average price of fees they have compared to other banks and, if further explored, specifically what fees.

Also, Section II 2-6(or however you designate it) is highly flawed. It allows any homeowner with a mortgage, at any time, to stop payments and then refuse to allow it to be foreclosed.

[Southern Senator North Carolina Yankee]

The amendment has been adopted.

[Southern Senator North Carolina Yankee]

I’m not sure if any of you are aware of this, but if you lower the revenue for banks, they will engage in behaviors to re-coup this money. Ideally, that would be investments increasing, but, realistically, without some sort of interest freeze, perhaps a limited freeze that phases this in, banking institutions will almost certainly raise interest rates on loans, mortgages, et cetera.

Furthermore, the current language seems to exclude credit unions from these rules - is that intentional? Because if so, the likely interest hike above will send consumers moving, probably on a larger scale than you might think, to the credit unions instead of banks.

To me, it makes far more sense to designate banking institutions based on fees, in at least three categories, so people can clearly see what average price of fees they have compared to other banks and, if further explored, specifically what fees.

Also, Section II 2-6(or however you designate it) is highly flawed. It allows any homeowner with a mortgage, at any time, to stop payments and then refuse to allow it to be foreclosed.

I appreciate you posting these concerns, I will seek to make sure they are addressed.

[Former President tack50]

I’m not sure if any of you are aware of this, but if you lower the revenue for banks, they will engage in behaviors to re-coup this money. Ideally, that would be investments increasing, but, realistically, without some sort of interest freeze, perhaps a limited freeze that phases this in, banking institutions will almost certainly raise interest rates on loans, mortgages, et cetera.

Furthermore, the current language seems to exclude credit unions from these rules - is that intentional? Because if so, the likely interest hike above will send consumers moving, probably on a larger scale than you might think, to the credit unions instead of banks.

To me, it makes far more sense to designate banking institutions based on fees, in at least three categories, so people can clearly see what average price of fees they have compared to other banks and, if further explored, specifically what fees.

Also, Section II 2-6(or however you designate it) is highly flawed. It allows any homeowner with a mortgage, at any time, to stop payments and then refuse to allow it to be foreclosed.

Well, I have always thought that if banks see lower revenue, there will be at least one bank who does not increase interest rates and instead takes the revenue penalty. Said bank will now acquire a competitive advantage and all other banks will have to follow suit (or they will get even lower amounts of revenue and lose clients)

Regarding the 2nd proposal I am a bit ignorant there but your proposal to separate banking institutions into several categories based on fees is a good one.

Finally regarding Section II.6, it might need a bit of work so that it only applies to homeowners that are not behind on payments.

[Pyro]

I’m not sure if any of you are aware of this, but if you lower the revenue for banks, they will engage in behaviors to re-coup this money. Ideally, that would be investments increasing, but, realistically, without some sort of interest freeze, perhaps a limited freeze that phases this in, banking institutions will almost certainly raise interest rates on loans, mortgages, et cetera.

I wouldn't be opposed to adding a provision for an interest freeze should the Senate find this a necessary precaution. Though I would argue that the changes in this bill would boost consumer confidence and overall interest in investing in institutions and may lead to a greater number of account holders, thus far offsetting any losses.

Furthermore, the current language seems to exclude credit unions from these rules - is that intentional? Because if so, the likely interest hike above will send consumers moving, probably on a larger scale than you might think, to the credit unions instead of banks.

Credit unions were not specifically targeted in the writing of the bill.

To me, it makes far more sense to designate banking institutions based on fees, in at least three categories, so people can clearly see what average price of fees they have compared to other banks and, if further explored, specifically what fees.

I fundamentally disagree, what else can I say?

Also, Section II 2-6(or however you designate it) is highly flawed. It allows any homeowner with a mortgage, at any time, to stop payments and then refuse to allow it to be foreclosed.

It is my understanding that the consequences of failing to abide by a mortgage agreement are outlined sufficiently in such a contract - and the homeowner would have presumably signed this, thus granting authorization. Sec II 2-6 only comes into effect in the case that the above condition is not met.

For example, if a homeowner has agreed to a specific payment plan and the bank decides to abruptly end or change the plan (like, moving from an income-driven arrangement to a flat per-month fee), the law as-is holds no provision, as I understand it, which would prevent an immediate foreclosure should the bank so desire. With Sec II 2-6 implemented, the homeowner may have a case that the foreclosure is not warranted as the abrupt change was not authorized.

[Kingpoleon]

If this doesn’t apply to credit unions, I am sure that it will encourage people away from banks and towards credit unions. I urge the Senate to keep this in mind when discussing and voting on this bill, as it is not an obviously intended consequence.

[Mr. Reactionary]

A primer on unconstitutionally excessive fines:

https://en.wikipedia.org/wiki/United_States_v._Bajakajian

Comparing the gravity of respondent's crime with the $357,144 forfeiture the Government seeks, we conclude that such a forfeiture would be grossly disproportional to the gravity of his offense. It is larger than the $5,000 fine imposed by the District Court by many orders of magnitude, and it bears no articulable correlation to any injury suffered by the Government

Yeah, a fine of 40% of a banks entire annual profits for imposing a $2.00 fee once is excessive by a stupid amount of orders of magnitude and bears no articulable correlation to any injury suffered. I can't imagine any justice would find this proposed government theft constitutional.

[Former President tack50]

Maybe we could make it so the banks that get caught have to pay back to their clients all fees they have made them pay and then pay to the state the equivalent of 5 times the fees they have racked up?

With frequent enough inspections and a strong public campaign this should be enough-

[Mr. Reactionary]

Maybe we could make it so the banks that get caught have to pay back to their clients all fees they have made them pay and then pay to the state the equivalent of 5 times the fees they have racked up?

With frequent enough inspections and a strong public campaign this should be enough-

I cant imagine that fine would be classified as excessive. Thats much more reasonable. 5 x isnt unreasonable and yeah, the threat of constant litigation would likely convince banks to discontinue them and doesn't pose Constitutional issues.

Edit: you might want to tack on reasonable legal expenses necessary to recover the amount as well. That would be directly attributed to the violation so should be ok too.

[Southern Senator North Carolina Yankee]

So I take it there is another amendment coming here?

[Southern Senator North Carolina Yankee]

So I take it there is another amendment coming here?

[Southern Senator North Carolina Yankee]

So Tack, about that possible amendment?