by Jeff Sovern
On Tuesday, the Times printed an editorial, Clearer Bank Account Terms at https://www.nytimes.com/2011/12/27/opinion/clearer-checking-account-terms.html. Here's the concluding paragraph:
By requiring banks to provide straightforward, uniform account disclosure forms, the Consumer Financial Protection Bureau would give customers the ability to comparison shop as well as avoid fees. The Chase form, for example, shows that customers can avoid the $34-per-item overdraft fee by linking a checking account with either a savings account or credit card. Voluntary measures are all to the good. But the consumer agency should make clear, concise disclosure the industry standard.
Today the Times printed my letter about the editorial:
You are quite right to call for clearer disclosures of checking account fees. But disclosure may not be enough to protect consumers.
My study of mortgage disclosures, published in the Ohio State Law Journal, found that many borrowers spent little time reading the final loan disclosures and rarely, if ever, backed out of loans upon learning the terms.
Even the Chase form you praise is three pages long and discloses more than 30 fees.
It is hard to imagine many consumers comparison-shopping on so many terms. Sometimes, disclosures create the illusion of consumer protection but not the reality.