Five House Democrats want DOJ investigation into bank fees

Peter WelchHouse Chief Deputy Whip Peter Welch (D-Vt.) is accusing banks of coordinating their fee strategies and wants Attorney General Eric Holder to investigate possible violations of federal anti-trust laws.

Welch, along with four Congressional co-signers, sent Holder a letter on Thursday that highlighted public statements released by banks and banking associations that, according to the letter, indicate coordinated efforts for fee structures.

“It appears that banks are seeking to justify fee increases after Congress and the Federal Reserve Board recently limited banks’ ability to collude with networks to set debit interchange fees,” the letter said. “Statements made by individual banks and their trade associations raise questions about whether some price increases that have occurred this year have actually been coordinated.”

The letter quoted an email sent by the Texas Bankers Association to its members after the Durbin Amendment passed.

“Now, the industry must regroup and each and every one of you must decide how you are going to pay for the use of debit cards,” the email read, according to Welch’s letter. “It may be through a monthly fee; it may be by using a ‘prepaid’ card as opposed to a debit card; it may be that there is a way to not offer retailers instant credit for the transactions, limiting the amounts that can be charged, etc…”

Welch led the House effort on the issue of swipe fees and worked closely with Senate Majority Whip Dick Durbin (D-Ill.) to pass the Durbin Amendment into law, which capped the fees enough to significantly cut into banks and other financial institutions’ profits.

The letter was co-signed by Reps. John Conyers (D-Mich.), Raul Grijalva (D-Ariz.), Keith Ellison (D-Minn.) and Mike Honda (D-Calif.).

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