Update on Junk Fee Elimination

Update on Junk Fee Elimination

Junk fees might finally be eliminated 

Junk fees — those small, hidden charges that can balloon a purchase price — might finally be on their way out. This week, the White House announced a set of new guidelines from the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) that aim to eliminate these charges once and for all.

Why Junk Fees?

Junk fees are bad because they are essentially additional charges for basic or even fake services. One of the places junk fees jump out is hotels. You go to book a hotel for what you think is $90 per night. Then, by the time you’re about to confirm the booking, that price has increased to $120 a night. How? Junk fees. These fees are often hidden and carry ambiguous names like “service charge” or “resort fee.” Big banks are also often at fault; charging junk fees for basic services like keeping checking accounts open.

The Change in Guidelines

Under the new guidelines, companies will be required to include every fee in the initial pricing. Companies that do not follow this rule would be subject to penalties and be forced to refund junk fees to consumers. Unfortunately, and we don’t exactly know why, airlines are not included in this junk fee change.

Help Out

This new crackdown has not been completed just yet. But you can help make it happen. If you encounter junk fees, report it at reportfraud.ftc.gov. You can also submit feedback on the proposed guidelines here.


Do One Thing: Report junk fees to the FTC so that they can make these new guidelines as thorough as possible.

Chris O'Shea

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