[Congressional Record (Bound Edition), Volume 145 (1999), Part 6]
[Senate]
[Pages 8834-8836]
[From the U.S. Government Publishing Office, www.gpo.gov]




              FINANCIAL SERVICES MODERNIZATION ACT OF 1999

  The Senate continued with the consideration of the bill.


                           Amendment No. 314

     (Purpose: To make an amendment with respect to ATM fee reform)

  Mr. SCHUMER. Mr. President, I have an amendment which I send to the 
desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from New York [Mr. SCHUMER] proposes an 
     amendment numbered 314.

  Mr. SCHUMER. Mr. President, I ask unanimous consent reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       At the appropriate place, insert the following:
                       TITLE VII--ATM FEE REFORM

      SEC. 701. SHORT TITLE.

       This title may be cited as the ``ATM Fee Reform Act of 
     1999''.

     SEC. 702. ELECTRONIC FUND TRANSFER FEE DISCLOSURES AT ANY 
                   HOST ATM.

       Section 904(d) of the Electronic Fund Transfer Act (15 
     U.S.C. 1693b(d)) is amended by adding at the end the 
     following:
       ``(3) Fee disclosures at automated teller, machines.--
       ``(A) In general.--The regulations prescribed under 
     paragraph (1) shall require any automated teller machine 
     operator who imposes a fee on any consumer for providing host 
     transfer services to such consumer to provide notice in 
     accordance with subparagraph (B) to the consumer (at the time 
     the service is provided) of--

[[Page 8835]]

       ``(i) the fact that a fee is imposed by such operator for 
     providing the service; and
       ``(ii) the amount of any such fee.
       ``(B) Notice requirements.--
       ``(i) On the machine.--The notice required under clause (i) 
     of subparagraph (A) with respect to any fee described in such 
     subparagraph shall be posted in a prominent and conspicuous 
     location on or at the automated teller machine at which the 
     electronic fund transfer is initiated by the consumer; and
       ``(ii) On the screen.--The notice required under clauses 
     (i) and (ii) of subparagraph (A) with respect to any fee 
     described in such subparagraph shall appear on the screen of 
     the automated teller machine, or on a paper notice issued 
     from such machine, after the transaction is initiated and 
     before the consumer is irrevocably committed to completing 
     the transaction.
       ``(C) Prohibition on fees not properly disclosed and 
     explicitly assumed by consumer.--No fee may be imposed by any 
     automated teller machine operator in connection with any 
     electronic fund transfer initiated by a consumer for which a 
     notice is required under subparagraph (A), unless--
       ``(i) the consumer receives such notice in accordance with 
     subparagraph (B); and
       ``(ii) the consumer elects to continue in the manner 
     necessary to effect the transaction after receiving such 
     notice.
       ``(D) Definitions.--For purposes of this paragraph, the 
     following definitions shall apply:
       ``(i) Electronic fund transfer.--The term `electronic fund 
     transfer' includes a transaction which involves a balance 
     inquiry initiated by a consumer in the same manner as an 
     electronic fund transfer, whether or not the consumer 
     initiates a transfer of funds in the course of the 
     transaction.
       ``(ii) Automated teller machine operator.--The term 
     `automated teller machine operator' means any person who--

       ``(I) operates an automated teller machine at which 
     consumers initiate electronic fund transfers; and
       ``(II) is not the financial institution which holds the 
     account of such consumer from which the transfer is made.

       ``(iii) Host transfer services.--The term `host transfer 
     services' means any electronic fund transfer made by an 
     automated teller machine operator in connection with a 
     transaction initiated by a consumer at an automated teller 
     machine operated by such operator.''.

     SEC. 703. DISCLOSURE OF POSSIBLE FEES TO CONSUMERS WHEN ATM 
                   CARD IS ISSUED.

       Section 905(a) of the Electronic Fund Transfer Act (15 
     U.S.C. 1693c(a)) is amended--
       (1) by striking ``and'' at the end of paragraph (8);
       (2) by striking the period at the end of paragraph (9) and 
     inserting ``; and''; and
       (3) by inserting after paragraph (9) the following:
       ``(10) a notice to the consumer that a fee may be imposed 
     by--
       ``(A) an automated teller machine operator (as defined in 
     section 904(d)(3)(D)(ii)) if the consumer initiates a 
     transfer from an automated teller machine which is not 
     operated by the person issuing the card or other means of 
     access; and
       ``(B) any national, regional, or local network utilized to 
     effect the transaction.''.

     SEC. 704. FEASIBILITY STUDY.

       (a) In General.--The Comptroller General of the United 
     States shall conduct a study of the feasibility of requiring, 
     in connection with any electronic and transfer initiated by a 
     consumer through the use of an automated teller machine--
       (1) a notice to be provided to the consumer before the 
     consumer is irrevocably committed to completing the 
     transaction, which clearly states the amount of any fee which 
     will be imposed upon the consummation of the transaction by--
       (A) any automated teller machine operator (as defined in 
     section 904(d)(2)(D)(ii) of the Electronic Fund Transfer Act) 
     involved in the transaction;
       (B) the financial institution holding the account of the 
     consumer;
       (C) any national, regional, or local network utilized to 
     effect the transaction; and
       (D) any other party involved in the transfer; and
       (2) the consumer to elect to consummate the transaction 
     after receiving the notice described in paragraph (1).
       (b) Factors To Be Considered.--In conducting the study 
     required under subsection (a) with regard to the notice 
     requirement described in such subsection, the Comptroller 
     General shall consider the following factors:
       (1) The availability of appropriate technology.
       (2) Implementation and operating costs.
       (3) The competitive impact any such notice requirement 
     would have on various sizes and types of institutions, if 
     implemented.
       (4) The period of time which would be reasonable for 
     implementing any such notice requirement.
       (5) The extent to which consumers would benefit from any 
     such notice requirement.
       (6) Any other factor the Comptroller General determines to 
     be appropriate in analyzing the feasibility of imposing any 
     such notice requirement.
       (c) Report to Congress.--Before the end of the 6-month 
     period beginning on the date of the enactment of this Act, 
     the Comptroller General shall submit a report to the Congress 
     containing--
       (1) the findings and conclusions of the Comptroller General 
     in connection with the study required under subsection (a); 
     and
       (2) the recommendation of the Comptroller General with 
     regard to the question of whether a notice requirement 
     described in subsection (a) should be implemented and, if so, 
     how such requirement should be implemented.

     SEC. 705. NO LIABILITY IF POSTED NOTICES ARE DAMAGED.

       Section 910 of the Electronic Fund Transfer Act (15 U.S.C. 
     1693h) is amended by adding at the end the following new 
     subsection:
       ``(d) Exception for Damaged Notices.--If the notice 
     required to be posted pursuant to section 904(d)(3)(B)(i) by 
     an automated teller machine operator has been posted by such 
     operator in compliance with such section and the notice is 
     subsequently removed, damaged, or altered by any person other 
     than the operator of the automated teller machine, the 
     operator shall have no liability under this section for 
     failure to comply with section 904(d)(3)(B)(i).''.

  Mr. SCHUMER. Mr. President, I very much appreciate the chairman from 
Texas accepting the amendment, which he has told me he will do, and I 
believe he mentioned it on the floor.
  This important amendment involves, very simply, disclosure on ATM 
machines of fees. As many may know, on April 1, 1996, Visa and 
MasterCard, which run the largest ATM networks in the United States, 
ended their prohibition against surcharging ATM users. Before that, 
there could not be a second surcharge. This fee was in addition to any 
fee already imposed on a transaction from other bank customer 
withdrawals.
  Three years later, 93 percent of all banks are imposing ATM 
surcharges on customers. That is 31 percent more than last year. The 
bigger the bank, the more likely they are to surcharge and at a higher 
rate. What this means is, if you have a BankAmerica card and you go to 
a Bank One machine, you will pay two fees, one to the Bank One 
machine--which everyone expects to pay--and the other to the 
BankAmerica card. People are paying two fees. It is very difficult to 
figure out what they are.
  When the banks first started charging these fees, many of them didn't 
bother to tell their customers they would be charged. They had to 
figure it out by looking at the monthly statement. For anyone who has 
looked at their monthly bank statements and all the fine print, it is 
clear that the fees were not transparent. So, unsurprisingly, there was 
an outcry. I took to the House floor, when I was in that body, to show 
that banks were not disclosing these fees. I remember surveying the 
banks in New York City and finding out they were not disclosing them.
  So what we are proposing to do here is to rectify that wrong. This 
amendment is in the great traditions of Adam Smith, pure capitalism. 
Some have said we ought to eliminate the fees. Some have said we ought 
to cap the fees. My view is to let the free market prevail. Let people 
see what the fee is before they enter into the transaction and then 
they can make a decision. That is the way it ought to work in 
capitalism, in free market enterprise. So that is what this amendment 
does.
  Last year, a record $124 billion was generated in all-fee income. 
That is up 18 percent in 1 year from banks. The fees are going up. This 
amendment will not take away a penny of that, except from knowing 
consumers who decide not to enter into this transaction. We must do 
this. Awhile ago we forewent this amendment because most banks promised 
they were not going to impose surcharges, and to their credit for a few 
years they did not. But now they all do. It is time we have disclosure 
so when they say that they will always disclose, because some do it 
voluntarily, I simply say, ``trust but verify.''
  This is a simple, straightforward, reasonable, balanced amendment. I 
hope it will pass without hesitation.
  Mr. President, I yield my time. Is someone available to just accept 
it?
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, the Senator from Texas is unable to be 
here. He has been gone for a couple of minutes. I am aware of his 
willingness

[[Page 8836]]

to accept the amendment, and there is no objection on our side. I 
indicate that on behalf of Senator Gramm.
  THE PRESIDING OFFICER. If there be no further debate, the question is 
on agreeing to the amendment.
  The amendment (No. 314) was agreed to.
  Mr. SCHUMER. Mr. President, I move to reconsider the vote.
  Mr. DOMENICI. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I ask consent I be permitted to speak 
for 7 minutes in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. I thank the Chair.
  (The remarks of Mr. Domenici and Mr. Dodd pertaining to the 
introduction of S. Res. 98 are located in today's Record under 
``Statements on Introduced Bills and Joint Resolutions.'')
  The PRESIDING OFFICER. The Senator from Ohio.
  Mr. VOINOVICH. Thank you, Mr. President. I thank the Chair and I 
thank the Senator from Texas for letting me talk about the tragic death 
of two great Americans.

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