On April 15, 2025, the ABA Banking Journal reported that a federal court has vacated the CFPB’s rule on credit card late fees a day after the American Bankers Association and other plaintiffs reached an agreement with the bureau to end a lawsuit over the rule. Under the terms of the settlement with the plaintiffs, the CFPB acknowledged it exceeded its authority under the Credit Card Accountability Responsibility and Disclosure Act, and that the late fee rule violates the Administrative Procedure Act.
On March 5, 2024, the CFPB finalized the rule that aimed to cut excessive credit card late fees charged by large card issuers by lowering the safe harbor dollar amount for late fees to $8. The ABA, U.S. Chamber of Commerce, and other plaintiffs challenged the rule in U.S. District Court for the Northern District of Texas, arguing that the bureau exceeded its statutory authority.
In a joint statement, the ABA and the other plaintiffs welcomed the court’s decision and appreciated the CFPB’s recognition that the rule violated the law and the bureau’s willingness to resolve our legal challenge.
Read the ABA Banking Journal’s article here.