Newspaper article The Christian Science Monitor

Rising ATM Fees Draw Populist Ire of D'Amato

Newspaper article The Christian Science Monitor

Rising ATM Fees Draw Populist Ire of D'Amato

Article excerpt

Are you ticked off every time you have to pay double fees to withdraw money from an automated teller machine?

Consumer groups have been yelling about the issue for months. It has also gained visibility on Capitol Hill - from both sides of the aisle.

Now Sen. Alfonse D'Amato (R) of New York, chairman of the Senate Banking Committee, has asked the General Accounting Office to study what he terms "unfair" ATM surcharging. Like Rep. Bernard Sanders (Ind.) of Vermont, Senator D'Amato introduced a bill last year to ban the double charging, or surcharges, but it never left committee. Now he's turning to Congress's investigating arm to study the issue. In a letter to the GAO, he asked it to determine the extent of ATM surcharges and how much consumers are paying. "We would welcome a study," says Fritz Elmendorf of the Consumer Bankers' Association, which represents about 700 large banks nationwide. "But we oppose legislation that would keep the market from sorting this out." ATM users have long paid fees - usually about $1 - for using ATMs at banks other than their own. That's because your bank passes on to you a "foreign transaction" fee that the other bank charges it when you use the other bank's machine. Beginning last April, however, the national networks that link ATMs - Visa's Plus and Master Card's Cirrus - began allowing the bank owning the ATM to tack on an additional "surcharge" of $1 or $1.50 when noncustomers use its machines. That means consumers in some cities can now pay as much as $2.50 for an ATM withdrawal from a bank other than their own. The second fee is what bothers the senator. "Customers already pay a fee to use an ATM. Why should they pay twice for the same transaction?" D'Amato asked in a statement announcing the study request. "Technological advances are supposed to lower costs and increase convenience, not serve as vehicles to gouge customers." D'Amato estimates that the average New Yorker pays up to $300 a year in surcharges. …

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