U.S. banks to make $38 billion from overdraft fees: report

[Heidi]

Source: Reuters

Mon Aug 10, 2009 3:43am EDT

(Reuters) - Banks in the United States are poised to make $38.5 billion in customer overdraft fees this year, the Financial Times said, citing research by Moebs Services.

A large portion of the revenue is likely to come from the most financially stretched consumers, according to the paper.

It said the research showed that many banks have increased charges on overdrafts and credit cards in order to boost profits.

The median bank overdraft fee rose this year by one dollar to $26, the paper said, citing the Moebs data.

"Banks are returning to a fee-driven model and overdraft fees are the mother lode," Mike Moebs, the company's founder was quoted by the paper as saying.



Read more: http://www.reuters.com/article/newsOne/idUSTRE5790YM20090810

[Roland99]

1. I love how they try to maximize the fees, too

My bank (and I'm sure many others) will pay the highest dollar transaction first and go down to the smallest (instead of in chronological order). This means you could have 3-4 low-value transactions "bounce" instead of just one. Of course, being astute and knowing what's in ones checking account can avoid all that....

[Hugin]

2. Another, gotcha, which has started appearing is that they will lower the limit on a Credit Card to..

just above the current balance. REPEATEDLY! With as little notice to the customer as the law allows (or in some cases even less) causing the customer to inadvertently go over their limit. Then they sock it to them with punitive charges and interest rate increases.

Nice little game they've got going...

[saigon68]

67. You can thank Joe Biden (D) MBNA for that shit

And his brilliant bankruptcy reform bill he passed for the Chimp

[Epiphany4z]

13. yep right before the crash

this happened to me 2x and when I went to the bank to complain there where 3 people ahead of me in line bitching about the same thing...I did get a partial refund but they still got a nice chunk out of me. The thing is this can only happen to people who live pay check to pay check..you have to your account cut close for this happen...just another way to live off folks on lower rungs of the ladder.

[No Elephants]

3. Wish I owned Congress so much that they would legislate against their own best interests for my

benefit, too. Not really. I just want to be able to use the emote.

:sarcasm:

BTW, Democrats have been in the majority in both house since 2006 and have had the Presidency as well since January.

Here come the Republicrats. Only it's not a joke. http://en.wikipedia.org/wiki/The_Aristocrats_(joke)

[AsahinaKimi]

4. Wasn't there a time when ...

If you had a savings account you could actually earn a little interest that would eventually give you few extra dollars when you might need it for an emergency, or a rainy day jaunt to the shopping mall?

Now today the only thing a savings account is good for is in case you happen to go a tiny bit over your checking balance. The banks have so many hidden fees that if you placed 100 dollars in a bank account, and left it there, by the end of the year it might be gone despite the fact you haven't touched it or used it.

Banks used to be about saving money. You would probably have more money if you stashed it in a mattress. True you would have no interest, but then it would not disappear either in a year.

[Heidi]

5. The US system of writing checks doesn't make sense to me anymore.

It's like it's designed to benefit the banks (which I guess makes sense, if you're a bank) and unreasonably cumbersome.

Here, checks go directly to the bank along with the pay orders (with account info) of the creditor ya want to pay, and the bank pays the creditors. If you have, for example, a basic Swiss Post account, and you don't have sufficient funds to pay a creditor, your check gets sent back to _you_ by the Post, without ever involving the creditor or incurring an overdraft charge in the process.

Or, ya pay your bills online, as we do. For grocery shopping, etc., I use my bank card or pay cash.

[Kind of Blue]

6. I'm still hurting from the dings I got this past week

from my bank's creative accounting. I could just scream but am crying instead :cry: Thanks for posting, now I don't feel as confused about the increase of severity in their method.

[One_Life_To_Give]

7. Guess it's not George Baileys Savings and Loan

I hear there was a time when there were more important things than maximizing the bottom line.

[CBGLuthier]

12. You do know that movie is a fantasy?

I personally do not believe in any aspect of "the good old days"

People are greedy. Always have been.

[One_Life_To_Give]

14. Not all people are greedy bastards

I don't recall all businesses even today being focused solely on this quarters profit and loss statement. I think anyone who puts Surname and Son/Daughter is thinking beyond what the Balance sheet will say at the end of the quarter. I see local businesses with more cashiers than a big box store would put on, on more service people in the aisles.

There will always be some greedy people focused on immediate rewards. Just as there will be some who look to building long term relationships and long term profits. IMO We currently have way too many of the former and not enough of the latter.

[melm00se]

8. you avoid overdraft fees

by:

having a budget
recording every transaction
balancing your check book
not playing the "float"

take these steps and it is highly likely that you won't bounce another check again.

As to the way that items are posted to an account:

largest to smallest or oldest to newest should make no difference to you if you don't write checks for more than your account balance.

[high density]

9. That just makes too much sense. NM

[ThatPoetGuy]

11. That's for the way banks used to work.

Suppose you've got $75 in the bank, and you need to pay a $90 power bill. You call up your Uncle Eddie and ask him to loan you $100. Uncle Eddie transfers $100 into your account, and your bank statement says you have $175. So you pay your power bill. Then you pick up a $15 prescription, and you stop and get gas for $30.

You check your account, and you're in the negative. How could that happen? 75 + 100 - 90 - 15 - 40 = 30, right? Well, the banks have hired consultants whose job it is to try to find more ways to make people overdraft. It's not just that they do the largest negative transaction first -- they also do all negative transactions before any deposits. Even cash. So they rearrange the events -- 75 - 90 = -15, hit it with a $30 overdraft fee for -45, pay for the prescription and a second overdraft fee makes it -60, gas makes it -90 and another overdraft makes it -120. Only then do they put it your Uncle Eddie's loan, and you're still in the negative.

http://www.usatoday.com/money/perfi/credit/2009-07-08-banks-overdraft-fees_N.htm

It doesn't matter anymore what came first chronologically. If you do not have a cushion in your account equal to everything you're likely to pay in a month, there's a decent chance you're going to go into the negative. Even if you balance your checkbook scrupulously. This is a bank-run scam designed to make money off of people who are just scraping by.

[WriteDown]

16. There are two solutions to that...

Either wait until the money is fully deposited or just...I know this is going to sound crazy....pay with cash.

[katandmoon]

23. There's an even better solution. But we all know Congress won't grow any balls at this late date.

They will continue to look the other way while banks continue to screw over customers in the most egregious ways possible, because a lot more of that money banks are screwing customers out of is going into congress's campaign chests than mere bank customers can afford to contribute to them.

[WriteDown]

24. No, that is not a better solution....

paying with cash or even a prepaid debit card without overdraft will prevent you from having OD fees 100% of the time.

[totodeinhere]

35. Or sign up for overdraft protection. Almost any bank offers that service. n/t

[Blue_Tires]

17. that used to happen to me as well

i.e. writing checks or using my ATM card on the day of my supposed direct deposited paycheck...now I always wait a day after, just to make sure...

[Epiphany4z]

18. exactly

If you make enough noise they will refund some of the fees-once,... if it happens again forget it.

Now days I pay bills late sometimes to make sure I have a bit of cushion cash in the bank. This means I either pay late feels or let the bank roll the overdraft fee wheel of fortune and see what they come out with. Maybe all my charges will go threw, maybe it will land on one$30 overdraft fee or maybe it land on bank bonus and cost me 150...weeeeee fun fun

[Orrex]

20. A great answer!

Too often on DU I've seen the knee-jerk rush to castigate the victim of paycheck-to-paycheck living as though everybody has made the conscious choice to live on the very cusp of financial collapse.

And--invariably--some blame-the-victim -type will offer up a story about how bad he had it until he bootstrapped himself back to solvency and fiscal success, and shame on everybody else.

[mntleo2]

27. Yes Blame the POOR for Gawd's Sake!

...as a low income person I get it in the shorts for everything. I pay 10-15% of my already meager income more in taxes than my upper class compatriots, I pay those late fees through the nose and pay those overdraft fees that pretty much decimate my family.

Listen up People: ALL THESE THINGS I PAY ARE FOR NECESSITIES. You know, silly things like the electric bill, shoes for my grand niece, food that my $1.00 per meal per person does not cover, toilet paper, soap, shampoo, underwear, all those "luxuries" doncha know ...

Sheesh

Cat In Seattle

[hugo_from_TN]

30. Umm, don't write checks till the deposit has cleared.

[ThatPoetGuy]

51. Why should cash given to a teller have to clear?

Why should money transferred from another account at the same bank have to clear? The money is taken from the other account, instantly; but the money does not go into your account until after all other payments and withdrawals, now.

Suppose you have $1 in the bank. You walk in, give the teller $50 in cash, and then you decide to withdraw $20 in cash. Don't you think there's something wrong -- seriously, really wrong -- if the bank decides to run your $20 cash withdrawal BEFORE your $50 cash deposit? But they can do that, legally, and you wind up overdrawn.

[Political Heretic]

58. Thank you for sticking with this. I'm so sick of the "personal responsibility" police

asking us to ignore institutional exploitation of high-risk groups of people.

[brentspeak]

33. Thank you for explaining that. The banks are deliberately having accounts overdraft

[Political Heretic]

57. Thank you for the great example. The guy who made that post you respond to needs gently smacked

into 21st century reality.

[LanternWaste]

19. Aditionally...

Additionally, one may avoid overdraft fees simply by not having any unexpected emergencies...

[Political Heretic]

55. Also, but never making a mistake in their entire lived existence.

[Political Heretic]

56. Oh also, by making sure that no company they do business with ever double charges, or makes an error

[LanternWaste]

60. I do hope you realize that I was being facetious..

I do hope you realize that I was being facetious.. :P

[PA Democrat]

36. Guess again. You can play by the rules and still get screwed:

Hosed at the gas pump -- by your debit card
http://articles.moneycentral.msn.com/Banking/BetterBanking/HosedAtTheGasPumpByYourDebitCard.aspx

<snip>

If you ever use your debit card to pay at the pump, watch out: Did you know that every time you top off the tank, a chunk of your checking account can be blocked -- sometimes for days, with the potential to cause you all sorts of financial headaches and bounced checks?

That's what happened to Jessica Hathaway, a state employee from Allentown, Pa. Earlier this year Hathaway stopped during her commute to fill up her car at Rauch's Mini Mart. She bought $22.29 worth of gas using her debit card.

If you use your debit card at a pump that does not require a PIN, your bank regularly will block out an amount -- often $50 or $75 -- on your card.

That amount doesn't "un-block" as you drive away. Instead, the hold remains up to 72 hours, until the station does a "batch" transaction that lets the bank know the actual amount, according to the U.S. Public Interest Research Group.

[RaleighNCDUer]

40. Wow. That's one I hadn't heard about before. And I use my debit

card for MOST purchases. I don't have a credit card, and I don't carry my checkbook - use it only to pay major monthly bills. So, if I was to use my debit card at the pump, but use the 'credit' feature (it being a Visa debit) rather than the debit with the PIN, it could screw with my balance?

I appreciate the warning.

[PA Democrat]

48. That is my understanding.

There was a feature on my local news about this story several months back. People had a $75.00 "hold" placed on their account for THREE DAYS, plus their account was debited for the actual amount of the gas purchase. People were getting hit with overdraft charges and they were furious because they had not overdrawn their account.

[mbperrin]

50. Even easier: I haven't banked since 1978.

No bank accounts, no bank loans, no bank cards. To hell with them.

And it feels good to have control of your own money.

[Political Heretic]

54. This is oversimplified thinking typically given by the comfortably middle class.

It's a very good idea do have a budget, and to record every transaction. Most people don't have a checkbook to balance because these days more transactions are done by Debit or ATM card. Banks give you the impression that your ATM transactions are automatically recorded in an online ledger that you can access 24/7.

But they're not. Not immediately that is, which is one of the many ways that someone trying very earnestly do be as financially responsible as possible can still get screwed.

And despite all of that, even while attempting to do everything you describe - guess what, people are still human. They make mistakes. When they do, the penalty for those mistakes should not be outrageous or unreasonable. That's why we have laws - that's why, at this forum, we believe in responsible regulation of business.

The fact that you keep talking about writing checks makes me guess that you're middle age or older and middle class or better. And of course, you'll write back and tell me how "wrong" I am, and you'll probably be lying, but that's fine.

The poorer you are the more finances become complicated. The easier it is to make mistakes. And the more organizations are actively trying to get you screw up. Some services are only lowest price if you agree to automatic account withdraws - poor people accept that in order to get the cheapest price they can afford, but then the withdraw from the company does not always happen at the same time, communication with the company is often murky at best, or god forbid, a person could simply make a mistake in tracking an automatic withdraw.

There are hundreds of ways in which the deck is stacked against poor people. And flippant "just manage your money better" comments are typically classist and shortsighted.

Pedatory practices by financial institutions should be restricted by government, regardless of whether or not individuals balance their checkbooks to your satisfaction.

Should banks be able to impose some penalty for overdrafts or other customer mistakes or - as you seem to assume - irresponsibility? Yes - but as with all other things in business, regulation is required to limit and prevent businesses from trying to reap excessive profit off of the exploitation disadvantaged groups of people.

[Doctor_J]

10. Hghtower just riffed on this last week

The "Check Cards", or "Debit Cards" are sort of like ATMs for banks. THere is no notification to the user for overdrafts - only fees. You can use your card 10 times in an afternoon, and incur 10 overdraft fees of $35 or so each, and not find out about it for weeks, when your statement comes with $400 worth of fees.

When we decide to take the country back, the bankers should be 2nd on the list of targets, after Hate Radio personalities.

[mntleo2]

28. AND Insurance Companies ...n/t

[2Design]

15. Get out of banks and into credit unions and get overdraft protection

Banks were trying to fight credit unions years ago - and they lost - credit unions are the only way to go

[susanr516]

22. Amen to that

I've been using a credit union for 30 years.

[Zhade]

61. Sadly, my credit union does the same damn thing.

I had no idea they were processing debits before credits -- even cash -- and have been blaming myself for instances that weren't my fault.

[2Design]

63. get overdraft protection - cost nothing n/t

[LynneSin]

21. It's real simple and I've done this with my credit & debit cards

Call them up and ask them to remove the overdraft. Sure, you could be embarassed at a restaurant or store when your credit is declined but that 5 minutes of embarassment will save you hundreds of dollars.

My situation was accidental - I had bought a computer and returned it and immediately bought another computer. I bought something else and my credit was declined but what baffled me was that I should have been about $2000 under my limit.

Problem is this - when you return something, the money doesn't get posted back until about 3 days later. So when I bought the second computer, I was technically over my limit but my overdraft protection let it slide. But the 3rd purchase was rejected.

I had a hissy fit because I make it a point of always knowing my balance and doing my best to not go over that balance. I would have rather been rejected on the 2nd computer and never go over my balance.

A major hissy fit got the mess cleared with no fees or impact to my credit rating or interest rate. However, I had them set the limit at the credit limit set. If I spent even one penny over I'd rather it be rejected then for me to get hit with those charges. Then I made sure I did the same with all my other accounts. With my debit, it's for card use only that it will decline - my actually checking account still has the 'overdraft' but that is a rare exception.

[FarCenter]

25. It might help to not use Debit/ATM cards for purchases

From the thread yesterday, it appeared that a lot of the problem is due to overdrafts caused by debit card transactions.

Banks have been pushing the use of debit cards (aka ATM cards, check cards) for purchases, and not simply for getting cash out of the ATM.

You should never use the debit card for making purchases. It should only be used for getting cash out of the ATM, and then only from an ATM where you will not be charged a fee for withdrawing cash from your account.

The problems with using debit cards for purchases are:

- They lack consumer protection features, unlike credit cards governed by Regulation E. When the money is gone from your account, it is very difficult to dispute the transaction and to have it reversed. Liability for fraudulent use of lost/stolen cards is higher. If someone skims your card with a hacked terminal, you could be out a lot more money.

- The transaction in many cases is a two step transaction. At a gas station, the authorization transaction that starts the pump may put a hold of $50 on your checking account. The settlement transaction after you have pumped $20 of gas will actually debit the $20 and transfer it to the gas station, but the hold on the remaining $30 will usually stay until a day or two later. This reduced your "available funds" in the account by an amount that you don't know of, and can trigger an overdraft. The problem is even worse if you use a debit card at a hotel. They may do the authorization transaction at check-in for the daily rate x the number of days, plus pad it by an amount reflecting their expectation of guest use of minibar, restaurant charges to the room, etc.

- If debit cards are used frequently for small purchases, people have a hard time keeping their check register up to date and accounting for all purchases.

You should:

1. only use debit cards for getting cash from fee-free ATMs.

2. make all large off and on-line purchase using a credit card that charges no annual fee and which you pay in full every month.

3. make all small, in-person payments in cash.

4. pay bills either by on-line payments using the biller's site (either by the above credit card or by ACH debit) or by paper check.

This minimizes the bank's opportunity to make money from you.

[Skink]

26. I'd say it is OK to use a debit card while shopping for food.

At which time you can get cash back if you want.

[FarCenter]

29. Good point

Since you don't swipe the debit card until the amount of the purchase is known, there shouldn't be an authorization transaction for a larger amount.

And it is a good way to get cash without paying a fee.

[flyarm]

31. but but but but ..now what do i do with my bailout pom poms??????

well i could use them for my failing support of the Public fraud Option i guess...

my pom poms are getting sad!

[AlphaCentauri]

32. and then they will ask for a bailout

that is insane.

[cbdo2007]

34. The business model is flawless - betting on the ignorance and laziness of Americans and their money.

Every American Citizen has the ability to stick it to the credit card companies here...yet very few of us will.

[askeptic]

37. They are purposely approving Debit / POS transactions

Even though they KNOW you don't have money in your account in order to purposely generate overdraft charges. This should be illegal! Debit and Point-of-sale transactions should be denied if there is not enough money in the account to cover. Further, they process your Check transactions daily from Largest to Smallest $$ amount, in order to be able to overdraft the largest number of Checks. The fees they are charging, in terms of APR, would be illegal in any other context, and ought to be here, too! I am so disgusted with these shysters!

[Heidi]

38. The best way to outwit them in the US is to just pay cash, even when it hurts.

If/when I live in my native country again, I'll be cash only, even if it hurts (a lot), for paying bills, for groceries, etc. The convenience of writing a check for bills and incidentals is convenient and pleasurable; the overdraft charges on account of creative posting of deposits and withdrawals is the awakening. Coarse as it may sound, my best-girlfriend-Bob describes this phenomenon as "the fuckin' you get for the fuckin' you got," not unlike the outcome of a bitter divorce.

I'm an American living in Switzerland the past decade, but I'd never in a million years go back to the US checking account system which gives debtors insight into one's financial situation. See my post upthread about this.

[sofa king]

39. I wonder how much of that is "fake" money that will never be paid.

I've lived below the poverty line for many years now, so when my bank invoked some hidden transaction fees I didn't know about, then started hitting me with "overdraft protection" fees every 72 hours, and turned a $24 balance into nearly -$200, I just walked away. It would take me nearly two months to pay it off, without spending a dime on anything else. My credit rating is already ruined and I'll be dead soon anyway, so unless they know some tricks I haven't seen, they're not getting it.

But I'll bet you anything the imaginary money they "earned" from me has been rolled into an imaginary credit to the bank, along with the fees assessed to millions of other low-income people like me who will simply walk away from the banks and live as we already do, from paycheck to paycheck. Those credits in turn will be used to leverage investments and pad funds.

Which means all the rest of you are going to pay several orders of magnitude more for it down the line.

As I have pointed out in other threads like this, when you walk to an ATM machine in New Zealand as an American tourist, those machines know exactly how much money you have. If you are a New Zealander, the ATM tells you what the bank thinks you have and what you think you have, and you can take all of it out if you wish.

An ATM machine and bank computers can justify your account just as easily as you can on a stupid and totally insecure webpage, which is what the bank shills here encourage you to do. Why don't they do that? They'll never give you a straight answer because they're too busy screwing all of us in the can.

[Zhade]

62. I for one don't blame you for doing what you have to do.

NT!

[Political Heretic]

41. Banks make $38bn from overdraft fees

Source: Financial Times

US banks stand to collect a record $38.5bn in fees for customer overdrafts this year, with the bulk of the revenue coming from the most financially stretched consumers amid the deepest recession since the 1930s, according to research. The fees are nearly double those reported in 2000.

The finding is likely to increase public hostility towards the financial sector, which has been under political pressure to ease the burden on consumers by increasing credit availability and lending more fairly after being bailed out by taxpayers.

Read more: http://www.ft.com/cms/s/43d18c68-851d-11de-9a64-00144feabdc0,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F43d18c68-851d-11de-9a64-00144feabdc0.html&_i_referer=http%3A%2F%2Fwww.ft.com%2Fcompanies%2Fbanks

---

This is one of many examples of predatory financial practices, but one that seems to get less media attention. Short term huge interest loans that specifically target poor communities and communities in which there are few other bank options is one example of a mob-like loan practice.

But the most outrageous one is banks, whose overdraft and other banking fees are no longer at all about recovering expenses, or even providing a disincentive to consumers. They are about raking in profit from poor people. Banks now hope you will overdraft, because it means money for them. More and more banks are unwilling to work with individuals because that would mean losing out in their share of the 38 billion dollar pie.

Banks now include more and more hidden fees, and continue to dream up ways to charge poor people more and more money. It's like the mob - you ask the bank for a favor, then the bank makes sure they own you for life, and that you remain constantly in debt to them.

Some people point out that overdrafts are a wrong on the customer side and banks have a right to penalize for that. That may be true, however I can tell you from direct experience the following:

I made a mistake in my bookkeeping once, and a charge for an online purchase I made cleared my checking account when I was not expecting it - I thought that charge had already cleared. Before I had noticed this happened I had made three purchases. I put $5.00 of gas in my car, I got a fast food meal for under $10, and I stopped at a convenience store for cigarettes back when I smoked. All told, just over $20.

Because of the one mistake in my bookeeping, those transactions all put me into the negative. In total, I was approximately -$22.00.

Within three days, the total my bank claimed I owed them because of a -$22 mistake totaled over three hundred and fifty dollars. I was extremely poor at the time, earning well below the poverty level. There was no possible way for me to pay that much money. When I pleaded with the bank they refused to work with me. The longer I didn't pay the more the debt was increased. This bank, in addition to overdraft fees nearing $40 per transaction, also charged $7-10 dollars per day each day an account was in the negative, plus a monthly charge for any account that had gone negative - both things I did not realize my bank did until this happened.

By the end of the month I owed over 500 dollars.

How was I able to fix this situation? I wasn't. I finally, after trying to work something out to no success, simply refused to pay them. I've found another alternative banking solution for my financial needs today. But my credit is shot, because there are hundreds and hundreds of dollars that I owe this bank that I refuse to pay - actually I still couldn't pay even if I wanted to. But if and when I do have a higher income, I would refuse to pay.

[barbtries]

42. i believe it

referred check charges have eaten me ALIVE. to this day i cannot always avoid them.

[Mithreal]

43. Juice the poor. Extract every last dime.

Good thing the banks had to give up something for their taxpayer handouts.

[Norrin Radd]

44. Fucking banksters.

[dixiegrrrrl]

45. I just read that the banks deliberately let you overdraw ATM balances

to create these fees.
Many details on how they scam you are here at the Market Ticker Report,

This means that one quarter of all accounts are responsible for basically all of this.

Of the remaining quarter, half of those account for nearly all (90th percentile plus) of the overdrafts. This means that roughly 12.5% of consumers are bearing the entire brunt of these fees.

70% of the overdrafts happen at a POS terminal or ATM, not by writing a check.

The last statistic is the clear one: There is no reason whatsoever for anyone to take such a hit. The bank knows before they approve the transaction that the money isn't there in the account.

more...worth the read to cover your butt:

http://market-ticker.denninger.net/archives/P1.html

[winyanstaz]

46. This is very timely post for me...because I just got off the phone with my bank...

Seems that a 20.00 dollar plus fees cash withdrawal netted me two 35.00 fees..putting me into the red by about 85.00 bucks when they got done. All this because the overdraft was sent through about 4 hours before an $880.00 dollar monthly automatic depost hit my account.
Oh the $880.00 dollars was there alright......it's just they wouldn't credit it against the only purchase (the 20 dollar withdrawal plus fee) until three days later..because it all happened late on a friday night. (that way they could hit me with the 35.00 fee twice)
When you are on a widows military pension, this hits hard.
I am going down tomorrow and change my bank to a local credit union.
and a big fu to you dear Bank of America.

[ProudDad]

66. Good for you!

It's crap like that that finally got me to dump "my" bank for a Credit Union back in the 80s...

Everyone should do it!!! There's NO good reason to support banks -- especially since they aren't lending to real folk any more....

[defendandprotect]

47. Unregulated capitalism = organized crime ---

[Zorra]

49. Wow. That's....evil, by most cultural standards. Banksters need to be

convicted of usury and locked up for life.

[Wednesdays]

52. K&R

:kick:

[BadgerKid]

53. Any chance of class action suits and/or DA action? n/t

[Ghost Dog]

59. So that's a blindingly green shoot, then.

:(

Look out, below.

[pitiful_pulp]

64. Happened to me for the first time

I was hit with $455 of fees in one day while traveling. A paper rent check was processed before a another deposit check had been processed on the same day. After a days worth of debit card swipes on balance over 1k, the following banking day, all the debit card transactions from the previous day were processed after the first check, but before the deposit, putting my account at a -$8 balance. 7 fees were applied at $35 each = $235 + the $50 dollars of transactions . They processed the deposit the following morning +$400, subtracting the fees I racked up the previous day with no alert or balance info leaving a balance of $157. I continued to swipe the card 6 times on about $200 of purchases thinking I had around $350 balance. They then processed the highest transaction of the day $150 gift first, the rest was coffee, food, etc.. This landed me another $210 of fees. After a call to the bank the following day they credited 3 fees = $105 but not enough in my mind.

I did get a supervisor to return my call and give me details of every policy they have to explain this immoral activity and the debate got quite heated. I did manage to get some disturbing facts before i was denied any more credits. I also asked if he was flagging my account and got a non-answer. I called back to be immediately forwarded to a supervisor which confirms my account was flagged for being whatever a bad customer with too many questions is flagged as.

The real disturbing facts I uncovered is the policy is purposely written to legally give the bank all the power it needs to apply fees and order of processing at their discretion. There is no way to "opt out" of the service. And there is no dollar amount your account can go negative before fees stop. There is a limit to 10 fees a day <$350>, and a 5 day limit you can carry a negative balance before it automatically denies purchases. Every day you carry a negative balance another fee is applied. With this policy a person who is overdrawn by one dollar, can continue to make purchases for up to 5 days incurring $1750 of fees on as low as $50 dollars of transactions <10 debit swipes a day at $1, extreme scenario, but doable>. Say a check you deposited is canceled while your on vacation and you keep making small purchases for week thinking you have the money. next time you check your balance it could be negative over $1000 in fees. My next call I will try to nail down their credit policy.


These policies are in fact predatory and needs to be regulated by congress and the president NOW! It is affecting middle Americans purchasing power delaying the recovery from the recession.

sorry for the long first post. I tend to be verbose but I like facts so hopefully I can add to the community.

[hedgehog]

65. Here's how some people I know have gotten caught:

set up automatic bill pay. Then comes the month when the bill is presented a day or so early and/or is higher than normal.