Companies sue Biden administration over crackdowns on 'junk fees'

Ahead of November's general election, President Joe Biden is betting a lot on cracking down on junk fees as an issue that will resonate with voters. However, he's running into one big issue: lawsuits.

Take for instance your credit card. Maybe you use it, but sometimes don't have the cash to make a payment on time. That could lead to a "late fee" being added to your final bill — sometimes without your knowledge.

Earlier this year, President Biden announced a multi-year effort to crack down on those fees, which can sometimes be $30 or more. The president's plan calls for that to be lowered to no more than $8 per month.

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The effort to eliminate junk fees has taken on hotels, airlines and banks. But if you're wondering why you may not be seeing the savings, it's because the Biden administration has run into opposition from some companies that are impacted by the policy.

Daryl Joseffer is an executive vice president with the U.S. Chamber of Commerce, a group that has been part of many lawsuits challenging the White House's rule-making ability in recent months. The chamber is also part of an effort to stop the president's credit card late fee change.

Joseffer said his group is looking out for the unintended consequences. A credit card company, for instance, may just deny a person credit if they can't impose proper fees.

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"Late fees are not junk fees," Joseffer said. "It's a fee because you didn't pay your bill on time."

Other groups have sued, too. Airlines for America is challenging a junk fee crackdown that requires upfront disclosures of ticket prices, saying it will bombard customers with too much information.

These lawsuits could — in theory — take years to settle, which would be well after the November election. That means a new administration could just change the rules back.