In March, the Consumer Financial Protection Bureau announced that a new federal rule would cap fees on late credit card payments at $8 a month, estimating that the change would save American households $10 billion a year.
On Friday, a federal judge in Fort Worth temporarily blocked the rule, siding with bank and credit card company lobbyists who contend in a lawsuit that it is unconstitutional.
Now, the lobbyists can continue their legal fight in U.S. District Court before Judge Mark T. Pittman, who granted the preliminary injunction.
The consumer bureau’s new rule would limit issuers to an $8 fee unless they could show that more money was needed to cover their collection costs.
The bureau estimated that the rule would apply to more than 95 percent of all outstanding credit card balances.
Persons:
Mark T, Pittman
Organizations:
Consumer Financial, Bureau
Locations:
Fort Worth, U.S