The Rudd Government needs to back new laws to outlaw outrageous bank penalty fees?

It was revealed today that banks are charging up to 775% profit on typical bank penalty fees Leader of Family First, Senator Steve Fielding said.

“Banks are raking in millions of dollars from excessive bank penalty fees and it must stop. The banks have today been given a green light by the Rudd government – to continue to charge excessive bank penalty fees – and it’s ordinary Australians who will wear the cost.

“The Rudd government needs to get rid of the marshmallow attitude and get some steel and toughness into its approach to the banks.

“The report released by the RBA 2 weeks ago showed in 2008, total fees collected by the banks hit $11.6 billion, up 8% from the previous year of $10.7 billion.

“The excessive fees charged by the banks smack of sheer corporate greed and are all the more outrageous given the enormous financial assistance doled out by taxpayers to support them during the global economic crisis.

“Families are hit hard by penalty fees of up to $50 for every dishonoured periodic payment, direct debit or cheque. Who can afford $50 for a minor mistake? And why should banks profit so obscenely from people’s mistakes?

“Banks have become a law unto themselves and the Rudd Government needs to step in and regulate bank fees. First the banks refused to pass on interest rate cuts, now we find they are raking in billions of dollars in outrageous bank fees.

“The Rudd government needs to take action and back Family First’s legislation before the parliament that pulls banks into line and stops the banks from ripping off customers with up to 775% profit gouging.

“Family First’s Australian Securities and Investments Commission (Fair Bank and Credit Card Fees) Amendment Bill 2008 would force banks to reduce penalty fees so they reflected cost recovery rather than being used as blatant obscene profit grab.”