SENATE BILL: Transactions Fairness Act (At Final Vote)

[Mr. Reactionary]

I am certainly not against restricting some of the fee charging that occurs, but I am concerned that there maybe a reduction in financial services offered in some cases if all such are eliminated in one swoop. Is there any risk of that being the case with this bill?

I do not think that would be the case, no. Financial institutions have cultivated expansive profit margins long before pushing microtransaction-like fees onto the consumer. Many of the fees listed in the bill have only come about in the past decade, to my knowledge, and exist for no legitimate cause.

Furthermore, I believe that the multi-national corporate entities most affected by the Transactions Fairness Act are extremely unlikely to allow their slice of the Atlasian economy to shrink as a result of it. The lion's share of profit in this industry is not built through ATM fees or Dual Tracking, after all.

Under the penalties section it says, "seizure of assets"? What assets? All of them, some of them? What guidelines dictate the seizure of assets as a penalty. What is the point of taking a percentage of gross income and then all of that assets if that is the case?

It's my understanding that asset forfeiture as a penalty would be handed down through a federal court, with the amount to be forfeited determined by the court itself. This penalty, as well as the 20/40% of Gross Income, is meant to deter financial entities from ignoring the guidelines set in this bill. If the consequence was merely, for example, a minor fine, I would wager that the liable parties would continue business as usual.

That disproportionately large penalty would likely violate the no excessive fines clause of the Bill of rights. I mean, if I charge a $5 ATM fee once in violation of the law is the proposal really a fine of millions upon millions of dollars? That's very Constitutionally suspect.

[Mr. Reactionary]

I am certainly not against restricting some of the fee charging that occurs, but I am concerned that there maybe a reduction in financial services offered in some cases if all such are eliminated in one swoop. Is there any risk of that being the case with this bill?

I do not think that would be the case, no. Financial institutions have cultivated expansive profit margins long before pushing microtransaction-like fees onto the consumer. Many of the fees listed in the bill have only come about in the past decade, to my knowledge, and exist for no legitimate cause.

Furthermore, I believe that the multi-national corporate entities most affected by the Transactions Fairness Act are extremely unlikely to allow their slice of the Atlasian economy to shrink as a result of it. The lion's share of profit in this industry is not built through ATM fees or Dual Tracking, after all.

Under the penalties section it says, "seizure of assets"? What assets? All of them, some of them? What guidelines dictate the seizure of assets as a penalty. What is the point of taking a percentage of gross income and then all of that assets if that is the case?

It's my understanding that asset forfeiture as a penalty would be handed down through a federal court, with the amount to be forfeited determined by the court itself. This penalty, as well as the 20/40% of Gross Income, is meant to deter financial entities from ignoring the guidelines set in this bill. If the consequence was merely, for example, a minor fine, I would wager that the liable parties would continue business as usual.

That disproportionately large penalty would likely violate the no excessive fines clause of the Bill of rights. I mean, if I charge a $5 ATM fee once in violation of the law is the proposal really a fine of millions upon millions of dollars? That's very Constitutionally suspect.

These financial institutions do not charge a $5 fee once. That isn't how it works. These various fees are charged and recurred routinely to account holders, with lower-income consumers particularly susceptible. Once these fees add up, they go beyond the billion mark. The penalties are fair with this aspect in mind.

I mean in that case even if the fine was just $100 per violation plus disgorgement of the fees the cost in legal defense alone would be enough to stop the practice. Multi million dollar fines per violation is clearly excessive. If they do it 5 x are you really saying 100% of gross profits of the entire bank be stolen? If they do it 6 x what then?

[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.

[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.