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ATM fee notices attacked

By Marcie Geffner · Bankrate.com
Tuesday, August 7, 2012
Posted: 9 am ET

The U.S. House of Representatives has passed a bill that would eliminate an ATM fee disclosure requirement.

Currently, the federal Electronic Fund Transfer Act requires banks, credit unions and others that operate ATMs to provide two notices that a fee might or will be charged. The first notice must be on the machine, the second on the screen or a paper printout.

Failure to provide both notices opens the door to consumer class-action lawsuits.

Industry groups have charged that plaintiffs in these lawsuits intentionally removed, destroyed or damaged the notices, then photographed the machines to demonstrate supposed noncompliance. The temptation is high since, according to the Independent Community Bankers of America, or ICBA, plaintiffs can recover $500,000 or 1 percent of the ATM operator's net worth, whichever is less.

The bill, H.R. 4367, would end the on-machine notice requirement. The on-screen or on-paper notice would still be required. However, that notice typically appears only after the consumer has initiated some sort of interaction with the machine.

Industry groups applauded the House's passage of the bill.

ICBA CEO Cam Fine said in a statement that the notice requirement "has led to baseless and frivolous lawsuits that threaten the viability of ATM operators." The group is a major supporter of the legislation.

Bill Cheney, CEO of the Credit Union National Association, said in a statement that credit unions "appreciate" passage of the bill, which "eliminates a frustrating regulatory burden."

"House passage of this legislation is an important milestone," Cheney said, "but the work is not done. We urge the Senate to take up this measure as soon as possible and provide credit unions with much-needed regulatory relief."

Fee notices are all the more important for consumers because fees to use an out-of-network ATM rose to new highs for the seventh consecutive year in 2011, according to Bankrate's 2011 Checking Account Survey, which tracks bank checking account fees.

The survey found that the average fee banks changed noncustomers for an ATM transaction last year was up 3 percent to $2.40 compared with $2.33 in the prior year.

Consumers generally can avoid ATM fees by using their own bank's ATMs.

Follow me on Twitter: @marciegeff

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26 Comments
Rob P in MD
August 11, 2012 at 8:57 am

Anyone with even a minute amount of intelligence knows if you use an ATM not associated with your bank, there will be a fee. Regulations, such as this, costs and the costs are passed on to the consumers. The only people who benefit from regulations such as this are the lawyers and those who take advantage of the system and walk away with thousands for a two or three dollar error. Stop being stupid.

R. Stickney
August 11, 2012 at 8:33 am

They are so worried about the burden of placing an ATM Disclosure about a fee might be charged to the transaction, why not worry why they must put push "1" for english, "2" for spainish. Next they will be placing every number between "3" - "1 trillion" to let any and all languages be on the ATM they better start worring about how much of a burden that will make. before a measly disclosure of how much it may or may not charge to an ATM transaction. In America we should not have to press "1" or "2" to see transaction in nothing but ENGLISH!!!!

Tom H
August 11, 2012 at 8:31 am

When ATMs were first introduced in the late 70s, they were sold as an added benefit to the consumer, intended to LOWER the cost of banking. Checks at the time were .10 each. ATMs were FREE because a teller wasn't involved with the transaction. Like usual, the banks are taking us to the cleaners!

j b
August 11, 2012 at 6:58 am

Please don’t get upset. This is what you are here for. Comply or waste your pathetically short life complaining.
With love, from the people you just bailed out.

Tim
August 11, 2012 at 5:54 am

This isn't intented to "hide" ATM fees from you. Just to prevent people from dirty law suits that hurt everyone that is apart of that bank system. It sounds like they will continue with on screen notices and honestly, you should know that if it's not an ATM belonging to your bank, they're going to charge a fee.

Gina
August 11, 2012 at 5:38 am

This is just wrong! We the people are allowed to be informed of everything even about fees. This is probably why a lot of people don't bank their money because they get charge to take out their own money that they have work hard for. I live in CT and when I do use another bank atm I usually get charge near $3.00 and then a dollar from my bank. This is ridiculous. What a way to scam people out of their money. U.S. House of Representatives needs to be kick out of office. They are definitely a waste of tax payer's dollars.

anna walls
August 11, 2012 at 3:50 am

yes i had to go to another bank.to make awithdraw.i knew i'd be charged.by this bank.but when i got to my bank i needed abank statement.thats when i seen i was charged 2.75 each for the two withdraws.like i said i knew that.but there was a 2.00 chargefrom my own bank.twice 4.00 total.they said it was out of the network.that they couldn't do anything about.no one told me that this would happen.its highway robbie.because they know that we have no other choice.but to use their bank.they weren't like this acouple of months ago.but since bank of america closed.oh we got that story to no we're going to close we're to big of a bank.seen it on the news i called them thenext day the bank.and that some of bank of america were closing.i took my money right out.maybe a couple months later they were going to charge you for using debit card.the president stepped in on that.can charge me my own bank?when i was already charged the 2.75

Andrew
August 11, 2012 at 2:05 am

so banksters won again.

RYCKD
August 11, 2012 at 12:47 am

I am all for removing useless regulations and fees, but no business should be allowed to screctly apply charges to a transcation without first notifing it's victim so one can make a informed descion.

Nick C
August 07, 2012 at 10:45 am

Most ATMs I see nowadays do not list the exact fee on the sign (just that a fee will be assessed), so this is not as much of an issue as it seems.