I always keep an eye on my Reg D transactions per month but my bank doesn't charge me for attempting the 7th, they just don't allow it.

I had a savings account with USAA, and they gave me a $10 fine for every transaction after the 6th.

I use wamu savings because of the good apr, but i hate the way their system works. To deposit from an external account the earliest you can do it is in five days in the future. Then when the five days come it usually takes another day or two before it is verified. All in all it takes 7 business days to do something that should take 1-2 days tops.

As much as people usually hate BoA, when I had more than 6 transactions from my "savings" account, all I got was a phone call from them, warning me. No fee. I guess as much as I hate my BoA, WaMu would have been worse.

It's a federal fine. No way around it. Wamu charged me $25 though.

This is yet another reason I only use local credit unions, left BofA and Wells Fargo 10 years ago and haven't been back since.

it's one of those stupid laws to prevent you from using your savings account as a checking account.

Though I find it curious that transfers between a brokerage account and savings account on Etrade is unlimited.

@SOhp101: The way around it is to not allow it to happen in the first place, like most decent banks do...hmmm "decent bank", is that an oxymoron?

FWIW, with Wells Fargo at least, it looks like online transactions don't trigger this law either. So, apparently, in person, via atm, or online appear to be ok.

Bank of America uses the same policy - but they charge you $3 for every transaction over the limit each month. This added up for me once when I hadn't realized this policy. They send out warning letters at the end of the month, and if it happens 3 months in a row then your savings is automatically switched to a checking account (keeping the same #).

this is not a mandatory fine. I have a HSBC online savings and did the 6 withdrawls this month. I got a notice in the mail. I called them about it, they said everyone gets one notice before the account type is changed or closed out.

wamu's pants are on fire.

@dragonvpm: I would double-check that, online transactions typically count against your limit, otherwise you would only have phone transfers counting against your limit and who does that anymore??

Hmm. This is totally new to me. I know the bank has mentioned something when we had a bunch of transfers but they didn't fine me to tell me I had angered the fed gods.

They used to also offer overdraft protection tied to your savings. It would just pull funds from there if you OD'ed. I wonder if the discontinuation of that had something to do with it.

They did this at Bankers Trust in Iowa too. and with Wells Fargo. I think it's pretty normal. I don't understand why the goverment should care but you know it's a way to make more money for them.

Hey you are breaking a rule, so we are not going to stop you from doing that we are just going to fine you..

I had this exact issue with WaMu as well, except it was even a bit worse. I share a savings account with a family member, and we regularly transfer money back and fourth with this account (We live 2000 miles away from eachother), for personal loans and such.

Over the course of 30 days, we had a total of 12 transfers. We weren't aware of this fee yet, and then suddenly noticed that the account was 40$ over drafted. They hit us with 6 x 10$ fees over the course of 4 days. Even worse, an ATM I had used charged its transaction fee seperately, so that counted as an excess transaction!!

However, my family member went to our home branch (I don't live where we opened the account), asked what this was about (I had no idea about this kind of fee). The manager of the branch promptly dropped the fees and informed us not to do it again. Problem solved.

*Always* go to a branch to complain with banks!!!!!!!!! The people on the phone are impersonal, lazy and generally not having fun with their complaint handling job. The people in the branch will always be nicer since they have to look you in the eye.

Perhaps it's a bank-backed, government mandated conspiracy to discourage people to save...ooops you put too much money into your savings account and can't get it out now, better not do that next month.

I did that with BoA. They sent me a letter for a warning about what I did. I didn't know what I did anyways, but I called the number they gave me and they told me I can't withdraw from my savings over 6 times. I did it about 10 times. They gave me a warning and they didn't charge me for anything, but if I did it again, they'd charge me and so on. Crazy stuff.

When my husband was laid off in the dotbomb era we found out about this rule since we relied on our rainy day savings for a few months.

My credit union however did NOT slap us with a fine they just wouldn't let you complete the 7th transaction and when I called they explained why and that was that.

Slapping you with a fee is just unacceptable especially when it could be set up like my credit union does and just not let the 7th transaction take place.

I have multiple WAMU accounts and got hit with the same fee last week. It sucks because their online data can take upwards of four days to reflect on the statement. I know that I am shopping for a new bank over something little like that. Banks should realize all it takes is a stupid "$10" fee to lose a customer and spread the word. There should be a alert letting you know you are going to be socked a BS fee.

It's in the agreement you signed up to. Get over it.

this happened to me at boa but it was a $50 fine but i was able to get it waived. now i have a mortgage with them and it is unlimited go figure.

Look at the regulation -- it only pertiains to withdrawels or transfers _from_ savings, not transfers _to_/from such accounts as stated in the original story.

You can put in as many times as you want!

@ironchef: Transferring from a savings account to a brokerage account on E*TRADE does count as a withdrawal.

I dunno. Which is really worse, getting hit with a $10 fee for the transaction or really not being allowed to get your money out if you really needed it. I'd think most people would take the $10 fee. I don't imagine most people fuss around that much with their savings account. If they are doing that many transactions, it's likely because something really unexpected as cropped up. I'd think being able to move the money is more important in that circumstance than $10.

@jscott73: Actually, the first time this happened to me was actually WITH a credit union account. This has been around for at least 12 years. I primarily bank with ING Direct, and they have that limitation as well, though I don't recall the charge. I seem to remember they didn't let the transfer go through, rather than putting it through and charging me.

IIRC, there are monthly transfer limits (number of times, not amount of money) for credit union savings accounts.

Perhaps someone can provide some specificity on that point?

@dragonvpm: I have first-hand knowledge that Wells-Charge-o does in fact hit you with this fee AND online transfers DO count towards the transaction limit. They send you a letter explaining why and threaten to convert your savings account into a checking account if you violate it more than 2 or 3 times within any 12 month period. Sorry to burst your bubble.

When I signed up for my Suntrust savings account, the excessive transfer fee was upfront and bold on the paperwork. I'm pretty sure that I have made more than six online transfers in one month, but I have never been charged a fee.

as the economy collapses look for corps to hit you every way they can

I had this happen from WAMU once too.

At the time I didn't know you were limited to 6 transfers. I knew the fine was totally them (I figured the Fed didn't collect any type of fine for this), but didn't bother arguing.

Other than that, haven't had any real issues with them since.

Still BS though. I wish they'd just prevent the 7th transfer. But Chris hit the nail on the head...why stop them when you can turn it into fee revenue!

You should always know these things about your accounts, like minimum balance and number of transfers/withdrawals before you get a fee. If they publish it somewhere, you really can't complain. Besides, it makes good sense to keep people from disturbing savings: the reason you get a marginally better rate on savings accounts is they expect the money to be there longer. I know the fee certainly keeps my transactions planned and minimal.

I'm confused. My BoA account has one of those 'keep the change' features where a debit purchase is rounded up to the nearest dollar and placed into savings. I literally nickel and dime it every day - far more than six transfers - and it violated the definition of 'savings'? (admittedly, my 'savings' are so small I blow that on Martinis in an hour.

I have never had this problem, and for a long time I only put money into my savings and not into my checking, (free interest earning checking acct.). I guarantee that I exceeded six transactions within 30 days.

I got that legal mumbo-jumbo warning from Wachovia but no fine or fee.

@SOhp101: Nowhere does it specify that the federal government is getting money from that fine. It's not instituted by them, but by the banks themselves.

I use a credit union and my online banking tells me how many of my 6 transfers I've used in a month. Once I get to 6 I have to go into a branch and do it there. They don't allow me to go over and I never had to make that many transfers in a month.

My real question is how poorly do you manage your finances when you have that many transfers to/from a savings account in one month...

I get paid every two weeks and even on a month I get 3 checks (twice per year on average) I still might only make one or two additional transfers to/from my savings account.

@choinski: The rule is about withdrawals or outgoing transfers, not deposits. You can make as many deposits as you like.

@FightOnTrojans: Apparently I've been lucky so far then, I checked my statements going back a year or so (which only have 1 automatic transaction per month) and I've never been billed. I don't often have more than 6 transactions, I had at least 4 months where I had more than 6 transactions total and all but the 1 automatic one was online.

@jscott73: I didn't check my agreement with WF, I just looked at my statements. No charges even in months where I had more than 6 withdrawls/transactions.

I guess I've just lucked out.

Reg D covers withdrawls out of your savings account. You can deposit money as often as you like. It only applies to phone and internet transactions where there isn't a way to personally verify you initiated the transfer (like a PIN number or a signature).

IIRC, the 6 transaction limit also applies to overdraft transfers. The fee is there to stop people from keeping everying in savings, earning interest and writing checks, waiting for the OD transfer. I'd rather get a charge for my overdraft than deal have them not process that 7th payment and return checks.

Even though I had the cash to cover any balances, I got slapped with overdraft check charges for every debit/charge card purchase from FirstMark (firstmarkcu.org). I got all but two charges back when I was in awe of the 17 charges FirstMark made against me. Still, that's a $50 lesson. The bank contended I did NOT have the money, although it was clear I did--with a several-hundred dollar balance in my checking, still.

The seventh transaction showed it went through on the website, only to find out it was voided LATER, which was why I got my money back.

And ATM transfers? They're electronic too, according to my credit union. Watch that.

I just keep enough in savings to cover six $25 transfers. The government regulation now just lowered my credit union's usable capital.

B of A did this to me a few years ago. I don't think I was ever more surprised by a fee and it was extremely infuriating. Here I was working really hard to save money everywhere I could, and they ambushed/sabotaged my efforts. I'm sure it's in their fine print, but it was something that really never occurred to me to look for. I felt blindsided and very distrustful of my bank after that.

i'm very pro-consumer & very anti-fee, but this is one fee i agree with for 2 reasons:

1) savings accounts are designed for just that - saving. set up your payments out of a checking account. most people that exceed reg d are simply trying to earn as much interest as possible, which isn't fair to other customers who follow the rules.

2) i doubt many people here have had a regulator screaming in their ear about falsifying reserve requirements, but they do. incessantly. that's what reg d is all about. central to the calculations made by regulators are capital reserve ratios that defined by account type (transactional vs. non-transactional). accounts that are transactional but exceed reg d transfers are supposed to be reclassified (which requires a recalculation of the reserve equation).

it's really not fun stuff.

@chrispiss: It's in the agreement you signed up to. Get over it.

Indeed. How dare the OP not remember the exact terms, fees, gotchas, rules and every other detail of every agreement/contract/terms of use/EULA they have ever come across (not to mention those updates the credit card and utilities send every few months).

I know that here at Consumerist we're all about understanding what it is we're signing or agreeing to before we sign. But seriously, who remembers these tiny details a week, month or a year later? Banks should be obligated to either provide a warning or prevent an action entirely if it's a violation of their terms. Popping a customer with a fee over an obscure violation like this one is just plain shady.

Oh, and WaMu did this to me too about 2 months ago. I'm in the processing of moving to a credit union now.

@mac-phisto: that last part should read "accounts that are non-transactional but exceed reg d..."

Well I did about 10 transfers online last month, and my credit union never charges me or stop me when I do more than six. They must like me :)

@JayDeEm: the rules are the same at credit unions (6/month), but the fee may be different (or there may be none at all).

you can ask a teller what happens if you exceed your reg D limit in a month & they should be able to get you an answer.

@mac-phisto: I had figured that the rules would be the same as far as the savings account is concerned, and I'm fine with that. This was just one of those 'last straw' kind of things for WaMu. I should have left them when they changed my default bill-pay account without any notification. The next time I paid the bills I was hit with a bunch of overdraft fees.

Here is the e-mail John sent to The Consumerist in full. Yes I do love my illiterate boyfriend.

So In the middle of the night I get my Stimulus Check. Fine. When I woke up this morning I transferred all the money to my savings account. Fine. Only to find that when I transferred that money I got an Excessive Activity Fee of 10 bucks from Wamu. So I called. I talked to the person who couldn't do anything for me and then I talked to a "Manager". She explained to me that there are federal regulations that state that a person can only transfer money 6 times in a billing cycle. By the way my cycle ends the 14th. Oh how close I was. The representative from Wamu said there was nothing she could do and I need to better monitor my account. Honestly I just want to know if anyone else has had this problem ? Yeah it's only 10 bucks. But as any fee could and would. They add up.

TCF didn't charge me a fee-They just closed my savings account due to the federal regulation.

A $10 fee does NOT prevent future violation of the stature, and should be refunded based on that statute.