FTC banning 'junk fees' for live events, hotels

Many of us have seen what looks like a great deal on concert tickets or a hotel room only to get to the checkout and discover it's not such a great deal after all because of junk fees.

A new federal rule finalized Tuesday should fix that.

"Junk fees" include things like "resort fees" and "convenience fees," but thanks to the Federal Trade Commission's new rule, those fees will be banned come the spring.

Concert tickets are just one of the offenders of so-called "junk fees." Those are the fees that pile up at the end of your transaction, pushing up your final price.

"This rule requires that companies provide all-in pricing so that any mandatory fee has to be built into the price when it's first presented to the consumer," said Chuck Bell of Consumer Reports.

That means no more surprises for consumers.

"It would allow consumers to make apples-to-apples comparisons. So when you're searching for a hotel or short-term lodging, you can see the full price and more effectively compare your choices," said Bell.

The total price also has to be displayed more prominently than any other cost. The new rule applies to live event tickets, hotels, and vacation rentals.

The FTC estimates it will save consumers 53 million hours of wasted search time a year, which is equal to about $11 billion in savings over a decade.

"The commission heard from thousands and thousands of consumers who supported the rule and wanted to see it go into effect," said Bell.

It was a bipartisan vote of the commissioners.

"It really shows when consumers have an issue, they should complain about it and complain to the right agency," added Bell. "If you're getting ripped off in the marketplace, don't be silent. Speak up, complain to the FTC or the CFPB. And they look at the patterns of complaints that they receive. And in this case, they've really taken a very effective action."

The Chamber of Commerce has opposed this change, calling it nothing more than an attempt to micromanage businesses' pricing structures.

But the FTC chair says that she is confident that this would withstand challenges in court.