STATEMENT: White House, federal regulators to unveil new crackdown on junk fees

WASHINGTON – In a joint announcement expected Wednesday, President Biden, Federal Trade Commission Chair Lina Khan and Consumer Financial Protection Bureau Director Rohit Chopra will outline a new crackdown on junk fees. The White House says this is part of its expectation that federal agencies adopt new rules to squash surprise fees and demand that companies provide accurate prices up front.

Federal officials say junk fees cost Americans tens of billions of dollars annually and hurt businesses whose prices might look more expensive because they’re disclosing everything up front.

In response, Teresa Murray, U.S. PIRG Education Fund Consumer Watchdog, said:

“We applaud this effort to stop businesses from padding their profits with gotcha fees. This sneaky practice has gone on way too long. When some businesses don’t disclose all fees up front, it hurts consumers and hurts companies that are transparent. Hidden fees are just wrong.

“The most common unfair practices include fees that aren’t clearly disclosed up front, after you already started buying that concert ticket or arrived at that hotel. Another way companies slip in junk fees is by giving a fee a fancy name that isn’t accurate or by portraying a fee as mandatory when it’s really optional. Finally, it’s not OK to bury a fee in thousands of words of terms and conditions and pretend it was disclosed.

“Consumers have been getting nickel and dimed – or dollared and 20 dollared – for years. Officials say that, every year, junk fees cost us tens of billions of dollars and tens of millions of hours as we wander through fine print, compare prices and root out mystery fees. We hope those days are ending.”