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(NEW YORK) — Tens of millions of Americans who overdraft on their bank accounts each year may soon enjoy major relief.

The government agency in charge of protecting consumers’ finances introduced a new rule to rein in overdraft fees charged by banks.

Americans paid a total of nearly $300 billion in overdraft fees over the past two decades, including $9 billion last year, the Consumer Financial Protection Bureau told ABC News in a statement on Wednesday.

Typically, large banks charge $35 per transaction in the event of an overdraft. The proposed rule could drop that charge to as low as $3, the CFPB said.

“This is about the companies that rip off hard-working Americans simply because they can,” President Joe Biden said in a statement about the proposed rule.

The Consumer Bankers Association, an industry trade group, criticized the proposed rule.

“This proposal on overdraft price setting is just the latest in a myriad of unnecessary and costly regulations by this Administration that seems guided by political polling, rather than by sound policy created by what should be independent agencies,” the CBA said in a statement to ABC News.

“The aggregate costs and impacts of these proposals on Americans’ access to essential financial products and services have not been appropriately considered,” the CBA added.

Here’s what to know about bank overdraft fees, how the proposed rule could save consumers money and when it will go into effect:

How overdraft fees work

For decades, banks have charged overdraft fees to customers who spend more than they hold in an account at the time.

Under a law enacted in the late 1960s, banks faced a general requirement to disclose the cost of lending to a borrower.

At the time, customer payments drawing on bank deposits were typically made through checks sent in the mail.

Overdraft fees, the CFPB said, became a significant source of revenue for large banks in the 1990s and 2000s, as consumers underwent a shift from paper checks to debit cards. Nevertheless, firms could charge penalties without the same degree of disclosure as other types of loans.

By 2019, total overdraft fee revenue reached $12.6 billion paid by tens of millions of borrowers. Two megabanks, JPMorgan Chase and Wells Fargo, accounted for one third of overdraft revenue reported by banks that reached over $1 billion in fees, the CFPB said.

“Decades ago, overdraft loans got special treatment to make it easier for banks to cover paper checks that were often sent through the mail,” CFPB Director Rohit Chopra said in a statement. “Today, we are proposing rules to close a longstanding loophole that allowed many large banks to transform overdraft into a massive junk fee harvesting machine.”

Neither Wells Fargo nor JPMorgan Chase immediately responded to ABC News’ request for comment.

The proposed rule will offer large banks two options in the event that a customer spends beyond the means available in his or her account.

First, large banks would retain the ability to provide a loan to the customer as long as it complies with existing lending law, including disclosure of relevant interest rates, the CFPB said.

Alternatively, the banks could charge a fee at an established benchmark in line with the amount a bank would require to break even on the transaction, the CFPB said. The proposed rule includes recommended benchmarks ranging from $3 to $14, the agency added, noting a request for comment to reach an appropriate amount.

If the agreed-upon overdraft fee lands in that range, it will make up a fraction of the current typical rate of $35 per transaction.

The rule would apply to roughly 175 insured financial institutions with more than $10 billion in assets, the CFPB said.

When could the new rule take effect?

The proposed rule alerts the public to the agency’s approach on a given topic, inviting public comment that can be incorporated into a final rule, the CFPB said.

Ultimately, a final rule must be published in the federal register to inform the public and other stakeholders.

A rule takes effect on Oct. 1 that follows the final rule’s publication in the federal register by at least six months, the CFPB said.

The proposed rule on overdraft fees, the agency added, is expected to go into effect on Oct. 1, 2025.

Greg McBride, chief financial analyst at Bankrate, said customers should remain vigilant in the meantime.

“It is far too early for consumers to let their guard down regarding overdrafts,” McBride told ABC News.

 

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(NEW YORK) — Electric vehicle charging stations could spring up at gas stations and grocery stores throughout Wisconsin, after the state Senate passed a proposed bill on Tuesday.

The bill, which passed by a 30-2 vote, would ease restrictions on businesses that install chargers and impose a tax on electricity sold to electric vehicle owners.

The measure would also make Wisconsin eligible for nearly $80 million in federal funds for the installation of charging stations and other electric vehicle infrastructure.

Here’s what to know about the proposed expansion of charging stations and what happens next with the bill:

What does the tax aim to accomplish?

The number of electric vehicles registered in Wisconsin has exploded in recent years.

The state counted roughly 17,000 electric vehicles last year; that was up from some 3,500 electric vehicles registered in Wisconsin four years prior, according to the Wisconsin Department of Transportation.

In turn, some lawmakers want to expand the state’s network of charging stations in order to accommodate the uptick in drivers.

Currently, businesses that offer EV charging stations fall under a set of regulations that typically apply to utilities.

The proposed bill would exempt the businesses from such rules as long as they sell electricity based on the amount that customer receives instead of the duration of time spent occupying a charger.

This approach would allow the state to impose a tax on the amount of electricity sold to customers.

How would the tax on electric charging stations work?

The tax would slap a 3-cent levy on each kilowatt hour of electricity sold to a vehicle owner.

Electric vehicle chargers are categorized as level 1, level 2 or level 3, meaning a first-level machine charges the slowest while a third-level one charges the fastest. All existing level 1 and level 2 charges would be exempt from the tax, but it would apply to all new chargers, as well as pre-existing level 3 chargers.

A Tesla Model 3, for instance, carries a battery capacity of 50 kilowatt hours. The tax for a full charge of the vehicle would amount to $1.50.

By comparison, the average cost to fully charge a medium-sized electric vehicle in Wisconsin is currently $11.11, according to an analysis by electric infrastructure developer Enel X Way.

If the bill is passed, the tax is expected to generate $3.1 million in fiscal year 2025, the Wisconsin Department of Transportation said. That revenue would go to infrastructure projects like roads and bridges.

State Assembly Rep. Deb Andraca, D-Whitefish Bay, a backer of the measure, said the tax aims to make up for an expected decline in funds generated by the state’s fuel tax, according to Eau Claire, Wisconsin, ABC affiliate WQOW-TV.

The tax, Andraca added, risks burdening electric vehicle drivers with onerous costs.

“I do hope that at some point we will address the problem that we are over-taxing drivers of electric vehicles,” Andraca told WQOW.

What happens next?

After passing in the Wisconsin Senate, the bill will now head to the state Assembly for a vote.

It is unclear whether Democratic Wisconsin Gov. Tony Evers will sign the bill if it passes both houses. Roughly a year ago, Evers touted ongoing efforts to expand the state’s electric vehicle charging infrastructure.

“These investments will be critical for bringing our infrastructure into this century,” Evers said at the time.

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(NEW YORK) — Several major retailers are re-evaluating self-checkout for customers after analysts have seen inventory loss.

“Retailers are really starting to use technology in order to look at the shrink problem,” Hitha Herzog, chief research officer of H Squared Research, told ABC News’ Good Morning America. “The technology that is powering self-checkout is also layering in other technology like AI that’s monitoring the customer, that’s checking out the products.”

One industry survey found that self-check-out represented 30% of transactions in 2021, and that 96% of food retailers surveyed offered it at their stores.

With cashier-less technology, however, also comes complaints of glitches while scanning items and paying.

One frustrated shopper, Dave Dolphin, told GMA “there’s always, like, one item that doesn’t scan and then all of a sudden — that light goes from green to yellow above you.”

The DIY system also has created an impersonal experience for customers, which many shoppers say they dislike.

“A lot of us want a human being. We want to have that conversation. We want to be able to voice our concerns or ask a question about a product,” Julie Domina, another shopper, told GMA.

Self-checkout is meant to keep things moving, but many times there are unavoidable long lines at self-checkout stations, packed with customers who have varying numbers of products to purchase.

Target stores are currently testing a 10-item limit for self-checkout lanes, as CNN first reported, to help reduce wait times.

Though consumers who spoke with ABC News agreed that self-checkout is convenient for one or two items, they also said they really enjoy having that personal interaction with a cashier.

Dollar General says it plans to ramp up its employee presence at the front of the stores. While it notes the convenience of self-checkout for some customers, a representative for the discount store told GMA that it “does not reduce the importance of a friendly, helpful employee who is there to greet customers and assist while the checkout process is happening.”

“People want that interaction,” said Heather Frye who works at a small grocer, Rivertown IGA, outside of Cincinnati, Ohio.

She told GMA that her store has “two self -checkout stations, but say they pride themselves on their personal ‘check-ins’ from their cashiers.”

“Our self-checkouts [are] just an option,” Frye added. “If you don’t want to use it, please go see the regular cashiers because they’re going to know your family, know what you usually shop for. They’re going to talk about the town gossip. They are friends.”

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(NEW YORK) — Tesla CEO Elon Musk is seeking greater voting control of the electric carmaker, threatening to otherwise pursue major projects such as artificial intelligence outside of the company, he said in a post on X.

The Tesla board, Musk said, should grant him 25% voting control, an amount that would nearly double the vote share currently afforded to Musk through his stake in the company.

The move would tie the company’s fate even more closely to its high-profile leader, ensuring Tesla will develop AI in-house at a time when the technology stands poised to shape the auto industry and a range of other sectors, proponents say.

Critics, however, caution of a risky precedent if the company’s board were to comply with the request, empowering Musk in any future dispute with shareholders little more than a year after he sold a large number of Tesla shares to help fund his acquisition of X, formerly known as Twitter.

“Musk is Tesla and Tesla is Musk and AI is a key to the future of Tesla,” Dan Ives, a managing director of equity research at the investment firm Wedbush, who is bullish on Tesla, said in a memo to investors on Tuesday.

Tesla did not immediately respond to ABC News’ request for comment.

According to Ives, Musk currently owns roughly 13% of Tesla. Before selling shares in 2022 to fund the $44 billion acquisition of X, Musk owned about 22% of Tesla, Ives added.

Musk, who co-founded ChatGPT-maker OpenAI but left the organization in 2018, announced the formation of a new AI company in July.

The possible development of AI outside of Tesla would deliver a significant blow to the company’s prospects, Ives said, citing the critical role of the technology in projects like full self-driving capability.

“If Musk ultimately went down the path to create his own company separate from Tesla for his next generation AI projects this would clearly be a big negative for the Tesla story,” Ives added.

Ultimately, the board and Musk could reach a compensation agreement in as few as three months that leaves both sides satisfied, Ives said, adding that the move would ensure some viewed by many as a tech visionary would lead “the new era of AI technology coming to Tesla.”

Gary Black, managing partner at the Future Fund, who is also bullish on Tesla, echoed the sentiment in a post on X. “Still plenty of time for the [Tesla] Board and Elon to come up with a new comp plan that properly aligns incentives,” Black said.

However, an agreement that expands Musk’s stake in the company could embolden him to assert even greater control down the road.

Such a prospect is especially concerning at a time when Tesla has weathered multiple product recalls and declining profit margins, Gordon Johnson, CEO and founder of data firm GLJ Research, who is bearish on Tesla, told ABC News.

“Musk is holding the company hostage,” Johnson said.

“The prospects for Tesla are dismal,” Johnson added, saying the demand from Musk offers him a pretext for departing the company. “He sees the writing on the wall.”

In December, Tesla agreed to recall about 2 million cars over a safety issue tied to its autopilot system, the National Highway Traffic Safety Administration said. Earlier this month, the company recalled an additional 1.6 million vehicles exported to China, citing a problem with the car’s assisted steering system.

The request for greater voting control suggests that Musk anticipates a substantial clash with shareholders over the direction of the company, Craig Irwin, an analyst at Roth MKM, who is also bearish on the company, told ABC News.

“He’s obviously worried about something,” Irwin said.

Further, Irwin downplayed the role of AI in the company, disputing the key claim made by Musk about his need for greater voting control.

“Tesla has done a great job with self-driving but it’s mostly a misnomer and cake dressing,” Irwin said. “Is this an AI or robotics company? How much do they really have? In my view, not much.”

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(NEW YORK) — In a dispiriting sign of the times, barely more than a quarter of Americans say the American dream still holds true — about half as many as said so 13 years ago.

Defined as “if you work hard you’ll get ahead,” just 27% in a new ABC News/Ipsos poll say the American dream still holds, down sharply from 50% when the question first was asked in 2010. Eighteen percent now say it never held true, up from 4%.

The rest, 52%, say the promise used to hold true but no longer does, up 9 points. Taken together, 69% say the American dream does not hold true today, up 22 points. And that’s in comparison to a poll taken in the aftermath of the Great Recession.

Although pessimism about the American dream has grown across groups, the change is sharpest among young adults. Their view that the American dream still holds true has dropped by 35 points, from 56% in 2010 to 21% now.

That compares with a 24-point decline among those ages 30 to 64 and 12 points among those 65 and older.

Differences among other groups also are evident. The survey, produced by Langer Research Associates with fieldwork by Ipsos, finds that attitudes of Black Americans towards the concept of the American dream are notably pessimistic.

The share of Black people who say it still holds true has fallen by 34 points, to 21%, compared with a 22-point drop among those of other racial or ethnic backgrounds.

Indeed, 32% of Black people say the American dream never held true, which is up 23 points from 2010, compared with 16% of others, which is up 13 points.

Income also differentiates views. Among people with household incomes less than $50,000 a year, just 18% say the American dream still holds true. It’s 27% in the $50,000- to less-than-$100,000 bracket and 33% among those in $100,000-plus households.

There’s also a gap by education, which correlates with income. Among people who haven’t gone beyond high school, 22% say the American dream still holds true (down 25 points from 2010), compared with 40% of those with a postgraduate degree (down 19 points).

Partisan differences are muted: A third of Republicans and Democrats alike say the American dream still holds true, as do a quarter of independents. Declines since 2010 are largely consistent across these groups.

Economic attitudes, predictably, matter as well. Among those who rate the economy positively, 45% say the American dream still holds true, compared with 22% of those who say the economy is in bad shape.

And it’s 41% among those who say they’ve gotten better off financially since the start of Joe Biden’s presidency vs. 23% among those who are worse off.

METHODOLOGY – This ABC News/Ipsos poll was conducted online via the probability-based Ipsos KnowledgePanel® Jan. 4-8, 2024, in English and Spanish, among a random national sample of 2,228 adults. Partisan divisions are 25-25-41 percent, Democrats-Republicans-independents. Results have a margin of sampling error of 2.5 percentage points, including the design effect, for the full sample. Sampling error is not the only source of differences in polls.

The survey was produced for ABC News by Langer Research Associates, with sampling and data collection by Ipsos. See details on the survey’s methodology here.

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(NEW YORK) — U.S. airstrikes against Houthi targets in Yemen on Thursday night escalated an ongoing conflict over a shipping route that holds significant implications for oil prices and inflation.

The military operation, undertaken in partnership with the United Kingdom, came in response to a monthslong series of attacks carried out by Iran-backed Houthi rebels on freight ships in the Red Sea.

Houthi Defense Minister Mohammed Nasser Al-Atefi said in a statement on Wednesday that the group would respond to the attack carried out by the U.S. and U.K.

The U.S. attack could cause a spike in oil prices and inflation if it sets off a wider escalation of the Israel-Gaza war, deepening supply chain woes and fueling price increases for many essential goods, analysts told ABC News. Oil prices surged 3% in early trading on Friday partly due to fear of such a scenario, they added.

The immediate impact of the attack appears notable but limited, analysts said, since many of the major shipping companies had already diverted their routes in response to the threat posed by the Houthis, analysts said.

“The absolute worst case scenario from a supply chain standpoint is if this escalates into a shooting war between the U.S. and Iran,” Jason Miller, a professor of supply-chain management at Michigan State University, told ABC News. “It would result in a massive increase in energy prices and if oil goes up, everything goes up.”

“Right now most carriers had already decided to reroute around the Red Sea, so this doesn’t change the dynamic there too much,” Miller added.

Since October, Houthi militias have launched over 100 attacks targeting at least 10 merchant vessels, according to a statement last month from the Pentagon.

The Houthis have targeted commercial ships traveling through the Red Sea as they approach the Suez Canal, which the U.S. Naval Institute says facilitates roughly 12% of global shipping traffic.

Major shipping companies MSC, Maersk and Hapag-Lloyd, as well as British oil giant BP, previously responded to the attacks by diverting their ships to alternative routes.

Freight rerouted from the Suez Canal typically travels around the southern tip of Africa, extending the length of the trip by roughly 30%, Jason Miller, a professor of supply-chain management at Michigan State University, told ABC News.

The increased travel time has strained the supply of ships, since longer routes mean fewer ships are available to carry goods at any given time, Miller said. That bottleneck, he added, has driven up short-term rates known as spot prices, which companies negotiate for the transport of their goods.

Prices stand at roughly $6,000 for a 40-foot container ship, up from $2,000 a year ago, according to a recent report from S&P Global Commodity Insights.

While small businesses will likely bear higher import costs resulting from the jump in spot prices, large retailers like Walmart and Home Depot would not be significantly impacted because their shipping costs are dictated by previously established contracts, Miller said.

The U.S. attack on Yemen could expand the number of ships diverting from the Suez Canal, since insurance companies will be reluctant to cover damage incurred by a possible attack, Christopher Tang, a professor at the UCLA Anderson School of Management, who focuses on supply chains, told ABC News.

Oil tankers, especially, may want to avoid the risk of environmental disaster and worker injury, Tang added.

“The risk is just too high,” Tang said.

The crisis in the Red Sea is likely to have a marked effect on consumer prices in Europe but could also increase prices for a range of U.S. consumer products imported from countries in Southeast Asia, such as India and Vietnam, since those goods travel through the Suez Canal, some analysts said.

Still, some experts cautioned that the trade disruption so far could ultimately have little or no effect on U.S. prices, since shipping fees contribute a fraction of the costs related to a typical item.

An escalation of the Middle East conflict, however, would dramatically amplify the effect on oil prices and inflation, analysts said.

“That would be a mess,” Rob Handfield, a professor of operations and supply chain management at North Carolina State University, told ABC News.

In the event, for example, of a potential outcome that puts Israel in direct conflict with Iran, a major oil producer, the resulting price shock would make it more expensive to operate factories and transport goods. A wide array of consumer prices, in turn, would jump.

“If it escalates further, it would be a disaster,” said Tang, of UCLA.

 

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(WASHINGTON) — The Federal Aviation Administration announced it will take the significant step of increasing its oversight over Boeing and begin an immediate audit of Boeing’s production and manufacturing in the wake of the door plug blowing out of an Alaska Airlines flight last week.

The audit will “evaluate Boeing’s compliance with its approved quality procedures,” the agency said Friday.

The FAA said it will also assess the safety risks around delegated authority and quality oversight — specifically the Organization Designation Authorization program. Under ODA, certain aircraft certification process is delegated to manufacturers like Boeing.

The door plug for the fuselage of a Boeing 737 Max 9 fell off a few minutes after Alaska Airlines Flight 1282 took off from Portland International Airport on Jan. 5, depressurizing the cabin and exposing passengers to open air thousands of feet above ground. No one was seriously injured and the plane landed safely.

FAA Administrator Michael Whitaker said the agency is “exploring” the use of an independent third party to oversee Boeing’s inspections and quality system.

“It is time to re-examine the delegation of authority and assess any associated safety risks,” Whitaker said. “The grounding of the 737-9 and the multiple production-related issues identified in recent years require us to look at every option to reduce risk.”

The FAA outlined three points of increase oversight Friday: an audit involving the Boeing 737 Max 9 production line and its suppliers; increased monitoring of Boeing 737 Max in-service events; and an assessment of safety risks around “delegated authority and quality oversight and examination of options to move these functions under independent, third-party entities.”

The announcement came one day after the FAA said it would investigate Boeing after the door plug incident.

Boeing said in a statement Thursday about the investigation, “We will cooperate fully and transparently with the FAA and the NTSB on their investigations.”

ABC News has reached out to Boeing and Spirit Aerosystems, Boeing’s parts supplier, for comment on the increased oversight announced Friday.

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(NEW YORK) — Trading is set to begin for a new type of bitcoin fund that gives investors access to the crypto market without some of the hassle and fees of owning bitcoin outright.

Freshly approved by federal regulators, bitcoin ETFs — Exchange-Traded Funds — allow investors to buy an asset that tracks the price movement of bitcoin.

Fidelity, BlackRock and a host of other top investment firms have already begun to offer the product.

Bitcoin ETFs promise major potential gains but also notable downsides, presenting investors with a wide range of outcomes that will test their tolerance for risk, analysts told ABC News.

Investors could capitalize on a possible rise in the price of bitcoin if a flood of money into Bitcoin ETFs vaults the cryptocurrency into mainstream markets, they said.

However, investors should be prepared to weather the asset’s considerable volatility as well as uncertainty stemming from its association with issues of fraud and mismanagement in the wider crypto industry, they added.

“It’s going to be a volatile ride,” Bryan Armour, the director of passive strategies research at financial firm Morningstar, told ABC News. “You have to know that going in and make sure you’re okay with that.”

Some analysts said the new products could unleash a flow of investment and trigger a major spike in the price of Bitcoin, supercharging the most well-known and successful digital asset.

A Bitcoin ETF would elicit more than $14 billion of investment inflows within its first year on the market and as much as a 74% price increase over that period, Galaxy Digital, a crypto management and research firm, said in a report in October.

Some traditional institutions outside of the crypto arena have echoed that optimism, at least to a degree. Deutsche Bank forecasted price increases for bitcoin this year due in part to “greater institutional investment” in Bitcoin ETFs, according to a report reviewed by ABC News.

A run-up in price would follow some previous bull runs for bitcoin, including a rise of nearly 70% over the past six months. But the cryptocurrency has also undergone periods of major decline.

The price of bitcoin experienced a decline of at least 45 percentage points four times in the past five years, Armour said on Wednesday in a report for Morningstar.

The acceptance of Bitcoin ETFs among a wide swathe of investors could smooth out some of the volatility but that outcome may not come to pass, Armour told ABC News.

“If adoption becomes wider and the market becomes more mature, the price will become more stable,” Armour said. “For now, I don’t see it stabilizing.”

Setting aside their volatility, Bitcoin ETFs carry risks posed by the uncertain effects of fraud and mismanagement within the crypto sector, some analysts said.

The crypto industry entered this year bruised after a series of high-profile collapses and company scandals.

Sam Bankman-Fried, formerly one of the industry’s most prominent figures, could serve decades in prison after he was convicted on fraud charges in a federal trial. Changpeng Zhao, the founder and former CEO of major cryptocurrency exchange Binance, faces a jail sentence of up to 18 months after he pleaded guilty to federal charges of money laundering.

In a statement on Wednesday, Securities and Exchange Commission Chair Gary Gensler affirmed the agency’s decision to approve Bitcoin ETFs but offered a note of caution about cryptocurrency.

“We did not approve or endorse bitcoin,” Gensler said. “Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto.”

James Butterfill, head of research at digital asset management firm CoinShares, rebuked concerns about bitcoin tied to potential manipulation or fraud.

The green light to trade Bitcoin ETFs gives them the “regulatory stamp approval,” Butterfill said.

Ultimately, investors considering Bitcoin ETFs should consider the role a potentially risky asset should play in their wider portfolio, analysts said.

“You shouldn’t allocate more to Bitcoin ETFs than you’re willing to lose,” Armour told ABC News.

Callie Cox, an analyst at the investment company eToro who tracks cryptocurrencies, said each individual should weigh Bitcoin ETFs within his or her own financial goals.

“You have your own hopes and dreams for your portfolio, so you should see how it fits,” Cox said.

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(WASHINGTON) — eBay will pay a $3 million criminal penalty for a campaign of harassment and intimidation undertaken by company executives that included anonymous home deliveries of a bloody pig mask, live insects and a funeral wreath, the Department of Justice said on Thursday.

The harassment targeted a Massachusetts couple for its online coverage of eBay, the DOJ said.

The San Jose, California, based online shopping firm was slapped with felony charges, including stalking, witness tampering and obstruction of justice, the DOJ added. The harassment took place roughly four years ago.

“eBay engaged in absolutely horrific, criminal conduct. The company’s employees and contractors involved in this campaign put the victims through pure hell, in a petrifying campaign aimed at silencing their reporting and protecting the eBay brand,” Acting U.S. Attorney Joshua S. Levy said in a statement.

eBay did not immediately respond to a request for comment.

From 2019 to 2020, Jim Baugh, eBay’s former Senior Director of Safety and Security, and six other employees on eBay’s security team targeted the couple for its role in publishing a newsletter about issues of interest to eBay sellers, the DOJ said.

Senior executives at eBay grew frustrated over the tone and content of the newsletter, as well as comments posted beneath the newsletter’s articles, the DOJ added.

In response, the DOJ said, Baugh and the other eBay employees carried out a campaign of harassment to intimidate the couple and change the tone of the newsletter.

The campaign included sending anonymous and disturbing deliveries to the victims’ home, and sending private Twitter messages and public tweets criticizing the newsletter’s content, the DOJ said.

eBay employees traveled to Natick, Massachusetts, to surveil the victims and install a GPS tracking device on their car, the DOJ added.

When Baugh learned of a police investigation into the harassment, he made false statements to the police and his team deleted digital evidence, the DOJ said.

eBay terminated all of the employees involved after an investigation.

“The company cooperated fully and extensively with law enforcement authorities throughout the process. EBay does not tolerate this kind of behavior. eBay apologizes to the affected individuals and is sorry that they were subjected to this. EBay holds its employees to high standards of conduct and ethics and will continue to take appropriate action to ensure these standards are followed,” the independent special committee formed by eBay’s board of directors to oversee the company’s investigation said in a statement at the time.

Ultimately, seven eBay employees were convicted for their role in the harassment campaign, many of whom served prison sentences. Bough was sentenced to 57 months in prison in September 2022, the DOJ said.

In addition to the fine, eBay agreed to retain an independent corporate compliance monitor for three years and improve its compliance process, the DOJ said.

“Today’s settlement holds eBay criminally and financially responsible for emotionally, psychologically, and physically terrorizing the publishers of an online newsletter out of fear that bad publicity would adversely impact their Fortune 500 company,” Jodi Cohen, special agent in Charge of the Federal Bureau of Investigation Boston Division, said in a statement.

“It also puts in place some much needed checks and balances to ensure an overhaul of eBay’s corporate culture,” Cohen added.

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(NEW YORK) — Consumer prices rose 3.4% in December compared to a year ago, accelerating markedly from the previous month and defying a smooth path down to normal levels, a report from the Bureau of Labor Statistics released on Thursday showed.

The Federal Reserve stands poised to dial back its inflation fight by cutting interest rates this year, but the latest inflation data could complicate those plans.

Interest rate cuts would ease borrowing payments for everything from credit cards to mortgages, but they risk stoking consumer demand and driving up inflation.

Prices last month rose faster than economists expected. The 3.4% rise of prices in December compared to a year ago sits more than a percentage point above the Fed’s target rate.

The price increases last month owed primarily to a rise in housing and energy costs, the U.S. Bureau of Labor Statistics said. Gas prices increased in December compared to a month prior, after having fallen considerably in November, the data showed.

Price increases for some food items continue to far outpace overall inflation. The price of beef rose nearly 9% in December compared to a year ago, while the price of crackers rose nearly 8% over that period. Prices for biscuits, rolls and muffins rose more than 4% in December compared to a year ago.

Some foods, however, declined in price. The costs of pasta and rice dipped slightly in December compared to a year ago. The prices of butter and breakfast sausage also declined over that period.

Core inflation, a measure that leaves out volatile food and energy prices, delivered better news. It climbed 3.9% in December compared to a year ago, cooling slightly from the previous month.

The inflation data arrives days after a jobs report for December showed hiring surpassed economist expectations, rebuking concern about a recession in the coming months.

The resilient jobs market aligns with optimism among many observers that the U.S. could avert an economic downturn, achieving a “soft landing” in which price increases return to normal levels while the economy continues to grow.

However, the robust economic performance may pose a challenge for the Federal Reserve as it tries to cool the economy and slow price increases.

Inflation stands well below last summer’s peak of over 9%, but remains well short of the Fed’s target rate of 2%.

The Fed risks a rebound of inflation if it cuts interest rates too quickly, according to some economists. An additional burst of economic activity for an already robust economy could hike demand and raise prices once again.

If the Fed maintains high interest rates for a prolonged period, however, the elevated borrowing costs could stifle business investment and consumer spending. Such an outcome could ultimately weigh on economic growth, corporate profits and employment.

Speaking at a press conference in Washington, D.C., last month, Fed Chair Jerome Powell urged caution about the outlook for the central bank’s effort to cool the economy and slow price increases.

“Inflation has eased from its highs and this has come without the significant increase in unemployment. That’s very good news,” Powell said.

“But inflation is too high, ongoing progress in bringing it down is not assured, and the path is uncertain,” he added.

Many market observers are expecting interest rate cuts as soon as a Fed meeting in March. As of last week, markets put the probability of a rate cut in March at 75%, said Ellen Zentner, chief U.S. economist and managing director at Morgan Stanley.

However, observers holding such expectations “may be in for a disappointment,” Zentner wrote last week, citing strong job gains that allow the Fed to keep rates high without fear of an imminent recession.

The cushion affords Fed policymakers “room to watch and wait,” Zentner added.

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