CFPB agrees to vacate credit card late fees rule

The ABA Banking Journal has reported that the CFPB has reached an agreement with the American Bankers Association and others to settle a lawsuit over its 2024 rule on credit card late fees.

Last year, the CFPB issued a final rule to lower the safe harbor dollar amount for late fees to $8, eliminate a higher safe harbor dollar amount for late fees for subsequent violations of the same type, and eliminate the annual inflation adjustment for the safe harbor amount that was provided by the Federal Reserve in 2010. A suit was brought by the ABA, the U.S. Chamber of Commerce, and others asserting that the CFPB exceeded its statutory authority in issuing the rule. Under the terms of a settlement, the Bureau acknowledged the allegations, and the parties have asked the court to vacate the rule.

On April 15, the ABA Banking Journal reported that the court has vacated the rule.