The Trump administration has requested a federal court to dismiss a regulation that caps credit card late fees at $8, arguing that it aligns with claims from business and banking groups who filed a lawsuit asserting the rule’s illegality.
The filing, submitted by the U.S. Consumer Financial Protection Bureau (CFPB) and the business groups involved, seeks U.S. District Judge Mark Pittman in Texas to finalize the termination of the rule.
Previously, Judge Pittman had blocked the CFPB from enforcing the late fee rule, which was part of President Joe Biden’s broader initiative to eliminate “junk fees.” Despite the court block, the Trump administration could have defended the rule on appeal.
The CFPB’s rule would have limited card issuers with over 1 million open accounts to charging no more than $8 for late fees unless they could prove higher fees were necessary to cover operational costs. The regulation was opposed by many Republicans, who have long criticized the CFPB for its broad authority and consumer protection enforcement efforts.
In December, Pittman, appointed by Trump during his first term, ruled that the late fee cap violated the Credit Card Accountability and Disclosure Act of 2009, a law aimed at curbing excessive charges while allowing penalty fees for credit card violations such as late payments.
