Overdraft Fees vs. The Government: New Developments

On Monday, Sen. Chris Dodd unveiled legislation to rein in overdraft fees. On Thursday Reps. Carolyn Maloney and Barney Frank did the same. Here's how the bills are similar:

• Both bills would require banks to receive consent from customers before enrolling them in the overdraft protection program.
• Both bills would limit the number of overdraft fees to six per year.
• Both bills would require banks to notify customers beforehand when a purchase or ATM withdrawal would trigger an overdraft fee.
  
• Both bills would stop banks from re-ordering transactions for the purpose of maximizing the number of fees.

What about differences?

• The House proposal would also apply to written checks that overdraw an account.
• The Senate bill excludes checks as it applies to the opt-in provision.

It will be interesting to see how this plays out.