In Breach Of Federal Law, Banks Hide Fees

The Red Tape Chronicles reports bank fees are so hard to find that even the government can’t find them. A recent investigation by the Government Accountability Office released this week couldn’t find the fee schedules at 1/3 of the nation’s banks. Not only does this make comparison shopping impossible for the consumer, they’re breaking federal law, the 1991 Truth in Savings Act and Federal Reserve Regulation DD, which requires fees to be posted clearly and conspicuously. Violations are rarely punished with any severity, meaning, as Red Tape Chronicles writes, “it’s far more likely that you’ll get a parking ticket for breaking parking rules outside a bank than it is the bank will be fined for disobeying federal lending laws.”

(Photo: Maulleigh)

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  1. bohemian says:

    By clearly and conspicuously do you mean somewhere like their website or on a brochure available in the lobby?

    If that is the case my bank is in violation. The only fees they post publicly are maintenance fees for certain accounts that have minimum balances. They don’t publish the overdraft fees or out of network atm fee anywhere.

  2. cde says:

    Small Claims Court

  3. dweebster says:

    Effective Federal Oversight.

  4. SuffolkHouse says:

    Hire a corporate suck-butt to run the country and SURPRISE, no one is watching the hen-house. Go figure.

  5. sixseeds says:

    @dweebster: Effective Federal Overlook.

  6. ellis-wyatt says:

    @SuffolkHouse: I just wonder if geniuses like you will ever join the real world? Seriously.

  7. Mollyg says:

    It is funny how many people who read Consumerist still have the quaint notion that big companies have to follow the law. It must be the same lot who still think that contracts are agreements between two parties.

  8. StevieD says:

    Fees posted clearly and conspicuously is something for the lawyers to hash out.

    Before anybody goes barking about banking rules just remember the rules must cover all situations, as in the case of a Canadian citizen trying to cash a check written on a Mexican Bank, the currency on the check is Euros, the customer wants to receive $190 in pennies and their only proof of identification is a credit card because they claim their passport and driver’s license were stolen. I guarantee somewhere in the banking rules and fee schedule is something just as ridiculous.

    The bank of my childhoold had a book by the front door. It was the size of an atlas and was printed in mouse font. The bank used their little book to NOT cash my Tax Refund Check because my savings account was $0.09 short to cover the value of the US Government check. Yes, $0.09 short.

    That same book today would meet the clearly and conspicously rule. Only today the book would have taken several volumes to complete and would most likely be published online rather than a friendly desktop book. If you ask the webdeveloper of the bank if the rules and fees are clearly and conspicuously available to all that seek the rules the webdeveloper will say yes. And I am sure the banks of today love to use their rules and fees as much as they can, which means the employees can find the schedule. Bottom line, just because some goverment entry level clerk could not find the information that the information can not be found.

    Like I said in the beginning, this entire issue is for the lawyers and since most of these banks are not being fined, either the government’s lawyers are not as good as the bank’s lawyers, or there really is nothing wrong with the method the banks are displaying their rules and fees.

  9. TechnoDestructo says:

    @StevieD:

    If e-coli is getting into the food supply, either the government’s inspectors are just not good enough, or there’s nothing wrong with e-coli getting into the food supply.

  10. StevieD says:

    @TechnoDestructo:

    If the food is cooked properly e-coli is generally not a problem. Alas the food is not cooked properly, so there is a problem.

    See, everybody shares some blame.

    The banks can find their fee schedules. I bet if I was really interested I could find the schedule as well. Because the idiot government inspector could nto find the schedule is that the fault of the bank?

  11. Trick says:

    @SuffolkHouse:

    Hire a corporate suck-butt to run the country and SURPRISE, no one is watching the hen-house. Go figure.

    Tell me about it! I never had one fee in the 90’s. Matter of fact, banks gave me money for bouncing a check or going over my credit limit.

  12. CaptRavis says:

    The fees schedule is availible in the banks ‘CRA file’, which is located in a locked drawer in the basement at the main branch office of each state that the bank does business. It gets updated once a year, with some sort of mystical ritual involving a clipboard, a red pen, and a burnt offering. Any customer can ask for it by name and be regarded with blank stares of bewilderment by any but the most senior of bank staff. Did the government think to check there?

  13. Buran says:

    @Mollyg: It is funny how they’re actually RIGHT.

    My bank posts its fee schedule in the list of important links you might want to read on the left side of the screen when you log into online banking. I don’t know where they keep it in their branches because I do all my banking online and all my deposits/withdrawals via ATM.

  14. vastrightwing says:

    Your mattress won’t charge you any fees!

    Seriously, most businesses work on the premis model to screw you first and then if you complain, they’ll apologize for the “mistake”. They can do this because many people are busy and forgiving. It’s sad that this works for them.

  15. Keat says:

    First Internet Bank of Indiana – firstib.com. The fee schedule is easily found and 1/3 the size of other banks. (I’m not affiliated with them, just a customer.)

  16. yikz says:

    @dweebster: Effective federal oversight? You mean growing big government? Yeah, that’s a good idea. Let’s pay more in taxes. Politicians are happy to create laws. They’re not so happy to enforce them. The banking lobby has a strangle hold on politicians, both on the right and the left.
    I think a good way of going about it would be to take them to small claims court. And get a large group of people to do it regularly.

  17. LUV2CattleCall says:

    @StevieD:

    Why did you get a tax refund check as a child?

  18. kittykat123 says:

    The information in question must be posted “conspicuously” within the branch, usually meaning that poster on the far wall with tiny writing. A brochure or a locked CRA file doesn’t cut it.

    @StevieD: The regulartions don’t require policies like that to be displayed, only things related to fees and money availablity. In addition banking rules don’t have to cover all situations, hence why managers are paid salary since they must make decisions. While I know that was simply an absurd example, it wouldnt’t need its own rule anyways. The first problem being that the customer would be denied if their ID was only a Credit card, never mind what type of check they had. Then since most local banks in the US dont convert Euro checks on the spot (some of the larger ones can) the check would be sent to collections. Same goes with it being drawn on a Mexican bank since I doubt it would have a MICR line to proccess. And if someone asked me for $190 in pennies, I wouldn’t even hesitate as I would find it hilarious to watch them carry almost 8 boxes of pennies out the door when 2 are quite heavy for many people.