cloudyn.png
Monday October 3rd, 2022 8:24PM

Bank CEOs questioned on consumer protections, social issues

By The Associated Press
Related Articles
  Contact Editor

NEW YORK (AP) — The CEOs of the nation’s biggest banks returned to Capitol Hill for a second day Thursday, and Senate Democrats strongly urged them to do more to help and protect their customers, while Republicans questioned whether banks should weigh in on hot-button social issues.

The bank leaders testified at a time when prices for food and other necessities are the highest in decades. JPMorgan Chase’s Jamie Dimon, Citigroup’s Jane Fraser and five other chief executives repeated the message they gave to a House panel Wednesday: The U.S. consumer is in relatively good shape but faces threats from high inflation and rising interest rates.

Senators’ initial comments reflected the lingering populist anger toward Wall Street more than a decade after the financial crisis as well as the looming election.

"You are among the most powerful actors in our economy,” said Sen. Sherrod Brown, D-Ohio and the chairman of the Senate Banking Committee. “Your entire industry, and its substantial safety net are supported by American taxpayers. It’s past time for the financial industry to be as good to the American people as the country has been to you.”

While billed as hearings on everyday finances and industry oversight, the CEOs also received a hefty dose of election-year politics in both chambers of Congress.

"Ms. Fraser it’s good to see you because you’re about the only diversity we have seen in this industry,” said Sen. Bob Menendez, D-New Jersey.

Menendez homed in on overdraft fees, acknowledging that banks have made progress in reducing them but also pushing the CEOs to completely eliminate such fees. Most of the CEOs said they now generally offer no overdraft fee products, and expect to see their overdraft fee income continue to decline. Bank of America recently said its revenue from overdraft fees has fallen 90% from a year ago.

One of the more contentious discussions involved Zelle, the private peer-to-peer payment network jointly owned by the banks. Zelle has come under scrutiny because of rising complaints of bank customers unknowingly authorizing payments to scammers via Zelle, and being unable to get their funds back. In contrast, fraud and scams on credit cards are generally covered by the credit card companies.

Elizabeth Warren, D-Massachusetts, pressed the banks on the issue of Zelle's safety. While acknowledging there are ways Zelle can be improved, the CEOs tried to differentiate Zelle from other peer-to-peer payment networks. The CEOs said services such as Cash App, Venmo or PayPal have significantly higher cases of fraud than Zelle.

“The issue is that a customer authorizes a transaction and it later turns out to be a scam, banks shouldn’t be on the hook for that,” said Brian Moynihan, CEO of Bank of America. He also said the scams account for a very small percentage of the transactions that take place via Zelle.

Republicans were focused on social issues, including banks making the decision to pay for employees’ abortion costs, gun rights and the financing of the oil and gas industry. Several senators also brought up the influence large asset managers like BlackRock and Vanguard have on corporations regarding social policies, because the asset managers are often the largest single shareholder in many of these companies.

“I can’t help but observe that when banks do weigh in on highly charged social and political issues, they seem to always come down on the liberal side,” said Sen. Pat Toomey, R-Pennsylvania, the top Republican on the committee.

Dimon seemed to agree with Toomey's assertion that federal regulators as well as asset managers have the power to sway banks on issues like climate change or lending to oil and gas companies.

“Speaking for myself, (the regulators) are my judge, my jury and my hangman,” Dimon said. "They can do whatever they want unless constrained by you,” referring to Congress.

In response to a question on the asset managers, Dimon quipped, “It's causing a lot of consternation among companies.”

Joining the CEOs of big Wall Street megabanks were the CEOs of three regional banking giants: U.S. Bank, Truist and PNC Financial. These three banks, with more than $500 billion in assets, were appearing for the first time in front of the House and Senate.

Regional banks have been merging and and growing quickly, which has made some top Democrats in Congress question whether they need to be more strictly regulated like the “too big to fail” banks such as JPMorgan and Citi.

“They are looking more like Wall Street than Main Street these days,” Brown said to reporters after the hearing ended. His counterpart in the House — Rep. Maxine Waters, D-California — has also called for stricter scrutiny of the regionals.

  • Associated Categories: Associated Press (AP), AP Online Headlines - Washington, AP Online Congress News, AP Business, AP Business - Consumer News, AP Business - Industries, AP Business - Financial Services, AP Business - Utilities
© Copyright 2022 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Bank CEOs questioned on consumer protections, social issues
The CEOs of the nation’s biggest banks returned to Capitol Hill for a second day Thursday, and Senate Democrats strongly urged them to do more to help and protect their customers, while Republicans questioned whether banks should weigh in on hot-button social issues
2:49PM ( 4 minutes ago )
White House: GOP abortion ban would mean a nationwide crisis
The White House and the American College of Obstetricians and Gynecologists say a Republican-led proposal to ban abortion nationwide after 15 weeks would endanger the health of women and have severe consequences for physicians
2:41PM ( 13 minutes ago )
Japan to loosen travel restrictions imposed during pandemic
Japan’s prime minister has announced that his nation's strict border restrictions will be loosened next month
2:22PM ( 32 minutes ago )
Associated Press (AP)
Biden seeks closer ties with Philippines after 'rocky' past
President Joe Biden has pledged in his first face-to-face meeting with new Philippine President Ferdinand Marcos Jr. to work to strengthen relations with the key Pacific nation after what he acknowledged had been some “rocky times” in the past
1:57PM ( 57 minutes ago )
Governor's races take on new prominence, with higher stakes
Governor’s races often are overshadowed by the fight for control of Congress during midterm elections
1:26PM ( 1 hour ago )
US sanctions Iranian morality police after woman's death
The U.S. government has imposed sanctions on Iran’s morality police after the death in custody of a woman who'd been accused of wearing her Islamic headgear too loosely
12:14PM ( 2 hours ago )
AP Online Headlines - Washington
GOP hits Kansas governor hard on trans athletes, her new ad
Kansas’ Democratic governor declares in a new television ad that she agrees men don’t belong in women’s sports
11:36PM ( 15 hours ago )
Virginia Thomas agrees to interview with Jan. 6 panel
The wife of Supreme Court Justice Clarence Thomas, conservative activist Virginia Thomas, has agreed to participate in a voluntary interview with the House panel investigating the Jan. 6 insurrection
8:48PM ( 18 hours ago )
House passes election law overhaul in response to Jan. 6
The House has passed legislation to overhaul the rules for certifying the results of a presidential election as lawmakers accelerate their response to the Jan. 6, 2021, insurrection and Donald Trump’s failed attempt to remain in power
7:48PM ( 19 hours ago )
AP Online Congress News
Ford shuffles management, seeks new global supply chain head
Ford is restructuring its vehicle development and supply chain operations, shuffling multiple executives just days after announcing that it would build up to 45,000 vehicles with parts missing due to shortages
1:56PM ( 58 minutes ago )
Fugitive in massive Navy bribery case caught in Venezuela
A Malaysian defense contractor nicknamed “Fat Leonard” who orchestrated one of the largest bribery scandals in U.S. military history has been arrested in Venezuela
1:31PM ( 1 hour ago )
EXPLAINER: Why a NASA spacecraft will crash into an asteroid
A NASA spacecraft is about to clobber a small, harmless asteroid millions of miles away
12:43PM ( 2 hours ago )
AP Business
GOP AGs push Visa, Mastercard, AmEx not to track gun sales
A group of Republican attorneys general are pushing the major payment networks _ Visa, Mastercard and American Express _ to drop their plans to start tracking sales at gun stores, arguing the plans could infringe on consumer privacy and push legal gun sales out of the mainstream financial network
1:45PM ( 2 days ago )
Regulators try to stop unlawful nursing home debt collection
A federal report says nursing homes and debt collectors are flouting a law that prohibits them from requiring friends and family of care home residents to be responsible for costs of the facilities
5:21PM ( 1 week ago )
Feds try to stop unlawful nursing home debt collections
A federal report says nursing homes and debt collectors are flouting a law that prohibits them from requiring friends and family of care home residents to be responsible for costs of the facilities
9:49AM ( 2 weeks ago )
AP Business - Consumer News
AP: Probe finds evidence of bank boss' romance with top aide
Investigators say they found evidence a former Trump official who heads Latin America’s biggest development bank carried on a romantic relationship with his chief of staff
11:26AM ( 3 hours ago )
Bank of England raises rates but avoids bolder hike like Fed
The Bank of England has raised its key interest rate by another half-percentage point
10:54AM ( 4 hours ago )
More consumers buying organic, but US farmers still wary
It used to be that organic crops were an oddity, destined for health food stores or maybe a few farmers markets
10:28AM ( 4 hours ago )
AP Business - Industries
Global markets waver after rate hikes in Europe, Asia, US
U.S. futures moved modestly higher and global stock markets sank after central banks around the world followed the U.S. Federal Reserve’s big interest rate hike with increases of their own in what’s become a global strategy intended to cool galloping inflation
8:37AM ( 6 hours ago )
Turkish central bank lowers interest rate to 12%
Turkey’s central bank has delivered another interest rate cut and lowered the benchmark rate by 1 percentage point to 12%
7:21AM ( 7 hours ago )
Bank of England rate hike avoids more aggressive step
Britain’s central bank has raised its key interest rate by another half-percentage point, avoiding more aggressive steps to tame inflation that the U.S. Federal Reserve and other banks have taken
7:10AM ( 7 hours ago )
AP Business - Financial Services
UK government formally confirms lifting of fracking ban
Britain’s government has formally confirmed it is lifting a ban on fracking in England, arguing that the move will help boost the country’s energy security following Russia’s invasion of Ukraine
6:14AM ( 8 hours ago )
France wants to boost renewable energy, now lagging behind
President Emmanuel Macron is set to unveil a plan to boost renewable energy in France including offshore wind farms and solar power
5:59AM ( 8 hours ago )
Drowning island nations: 'This is how a Pacific atoll dies'
Heads of state from Tuvalu and the Marshall Islands have launched a “Rising Nations Initiative” as they race toward solutions to a rising ocean level that will make their countries all but uninhabitable in the coming decades
2:24AM ( 12 hours ago )
AP Business - Utilities
White House: GOP abortion ban would mean a nationwide crisis
The White House and the American College of Obstetricians and Gynecologists say a Republican-led proposal to ban abortion nationwide after 15 weeks would endanger the health of women and have severe consequences for physicians
2:41PM ( 13 minutes ago )
Japan to loosen travel restrictions imposed during pandemic
Japan’s prime minister has announced that his nation's strict border restrictions will be loosened next month
2:22PM ( 32 minutes ago )
Prosecutors drop some charges in Florida nursing home deaths
Prosecutors have dropped manslaughter charges against three nurses who were present when 12 Florida nursing home patients suffered fatal overheating five years ago after Hurricane Irma
2:11PM ( 42 minutes ago )
Bermuda, Canada prepare for storm as Puerto Rico struggles
Bermuda and Canada’s Atlantic provinces are preparing for a blast from Hurricane Fiona even as authorities in Puerto Rico are struggling to open roads for people left stranded and without power by the storm’s devastating blow to the U.S. territory
2:10PM ( 44 minutes ago )
US missing many starters ahead of World Cup warmup vs Japan
Gregg Berhalter’s U.S. roster as the World Cup approaches is as notable for its absences as for those set to play in Friday’s warmup against Japan at Düsseldorf, Germany
2:07PM ( 47 minutes ago )