Bank Of America Treats Parking Meter Payments As Cash Advances, Charges $10 Fee

Reader Gary used his Bank of America credit card to pay $2 on a parking meter in Washington, DC. Bank of America treated it as a cash advance and slapped him with a $10 fee, as well as a higher APR. When Gary called to complain, he learned that it wasn’t an error: Bank of America has started treating payments to parking meters as cash advances and may even treat all payments to government entities as cash advances.

For the unfamiliar, multispace meters, also called “Pay and Display” machines, are a central machine where drivers can purchase time on a particular space or print out a ticket to display on their dashboards; most machines accept bills and credit/debit cards, allowing drivers without quarters to purchase parking. Obviously, a $10 service charge negates this convenience.
Gary writes:

I recently used my bank of America credit card to pay for a multi-space parking meter in Washington DC. The type electronic meter common in urban areas for parking on the street and which accepts credit card payments. The charge for parking was $2. Bank of America treats this charge as a cash advance. They charged me a $10 cash advance fee on top. So now I will be thinking twice before using any bank of America cards. A transaction that should cost $2 can come out costing $12. Also, my card currently has a 0% promotional APR on purchases, but they put the $2 parking purchase in a separate category subject to a much higher interest rate.

Gary sent us a follow-up the next day:

I spoke to their CSR twice and I never really got an adequate explanation. I am attaching a copy of the email explanation they sent me. From what I understood, they now treat payments to government entities as quasi-cash transactions. During my last conversation the CSR explained that parking meters and payments of fines would now be treated as quasi-cash transactions subject to a minimum fee of $10. I think this is something new that they recently introduced and I have requested an updated version of my terms of service to get a better understanding of these fees.

(Photo: dM.nyc™)

Comments

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  1. Crymson_77 says:

    F!@# BoA…that is just stupid.

  2. Jesse says:

    I read these and wonder what my bank has up it’s sleeves. Maybe time to swtich to a credit union before it’s too late.

  3. vgerik1234 says:

    Basically.. if you spend under $10 on those “quasi-cash” transactions, they add $10 to the original price?

  4. zentex says:

    blame the OP for using BoA (kidding) or blame BoA for being sneaky linguists?

  5. sleze69 says:

    I can’t imagine that Visa/MC would endorse this re-interpretation of what constitutes a cash advance. I look forward to the Comcast/BoA showdown in the finals of this year’s worst company contest.

  6. zentex says:

    @vgerik1234: it would appear the fee you incur is a minimum of $10, and it can go up based on the amount spent

  7. BloggyMcBlogBlog says:

    I don’t know it that’s the best picture ever posted on Consumerist, but it is the most ironically relevant picture to the story posted I’ve ever seen.

  8. sleze69 says:

    FYI – Here is a link to BoA’s policy on Cash Advance fees.

    [www.bankofamerica.com]

    I don’t see the part about parking meters or government entities.

  9. Cogito Ergo Bibo says:

    How in the hell does this differ from any other purchase made on my credit card? You are purchasing a service: parking. Not asking “mother may I have $2.” EVERY purchase would be a cash advance, if you follow this twisted non-logic!

  10. dragonfire1481 says:

    How do you get a cash advance if you don’t end up with any physical CASH in your hand? That’s a load of BS. I hope BoA doesn’t get away with this.

  11. Nyses says:

    Everyone needs to get away from Bank credit cards ASAP. It really is a no brainer, Banks are trying to make money, Credit Unions are, Not for Profit. You do the math!

    Everyone has at least a state credit union they can belong to. You typicaly just need $5 in a credit union account to qualify.

  12. ogman says:

    Truly the scummiest company in America, and maybe the entire world.

  13. EBone says:

    Well BofA, you can now kiss any future credit card transactions from me goodbye.

  14. Johnyalamo says:

    Can you imagine paying $12 for a burnt cup of Starbucks swill? Jeesh………

  15. They do this because gov’t entities (for the most part) don’t pay the normal merchant fees for accepting these types of payments. So BofA is looking for a way to recoup their cost.

    Still scummy.

  16. Landru says:

    It’s stupid, but I’ll bet the problem is that the meters process the charge as an ATM transaction rather than a credit purchase and BofAss can’t tell the difference (and doesn’t want to).

  17. SadSam says:

    I’m not defending BOA, but don’t all transactions with gov. (i.e. parking tickets) get processed as a cash advance b/c the gov. doesn’t pay the credit card processing fees like private companies do.

  18. Alex Chasick says:

    @Landru: It wasn’t worth mentioning in the post because they took it down and only a cached version remains, but until a few days ago, Cambridge, MA had this on their parking/tickets page:

    WARNING! Bank of America is now processing the payment of fines as a cash advance. If you use a Bank of America credit card to pay parking fines, the bank will treat the transaction as a cash advance and you may be charged a fee by the Bank of America. Any questions regarding the fee, please contact Bank of America.

  19. kepler11 says:

    @SadSam:
    I was going to suggest that too. For example, there is no way the post office is paying the normal CC fees on your miniscule stamp purchase. However this is the first report of a bank socking you with a ridiculous cash advance fee for paying a govt-related purchase with your credit card.

  20. MisterE says:

    Hmmm – I wonder if you could do a chargeback on the $10 Fee?

  21. Xay says:

    I wonder if this applies for my government issued BOA credit card.

  22. susilou says:

    Soon they’ll be treating cash advance fees, finance charges, etc. as cash advances too.

  23. ObtuseGoose says:

    This nickel-and-diming fee crap needs to stop. It almost seems like B of A is going out of their way to piss off (and lose) all of their customers. As one of their customers they lost a year ago, it truly boggles my mind.

  24. johnva says:

    @SadSam: Yeah, I’m guessing this has to do with how the transaction is coded as far as the merchant category. It still doesn’t make sense to charge a $10 cash-advance fee for it, when the cost of processing it is minimal. It’s not a cash-advance, so it shouldn’t be subject to those terms. If they don’t like that, they should make a separate category for government entities.

  25. STrRedWolf says:

    Okay, time to throw BoA into the blacklist…

  26. BlondeGrlz says:

    @xay: The irony of that possibility blows my mind.

    @Alex Chasick: I wonder why they took it down. Do you think BOA is that intent on keeping their fees hidden that they complained to the town? It’s hardly going to be top-secret info when you see the $10 charge on your account.

  27. balthisar says:

    If these aren’t PIN-based transactions, how can they be cash advances? The only way I can get cash on any of my non-BOA cards is either (a) use a PIN, or (b) go to any bank and ask for a cash advance (and sign for it).

  28. Nogard13 says:

    Well, that settles it for me. I just finished moving all my money from BofA to my credit union account. I’ll wait for the transaction to take place and then I’m calling and canceling my account with them (once it’s $0.00, of course!)

  29. esd2020 says:

    @SadSam: I think you’re probably right, though I just charged something (on a Chase Visa) at the DC DMV, and it went through as a normal charge.

  30. johnva says:

    @BlondeGrlz: I think it’s more likely that the town took it down because it was cutting into the town’s revenue from people paying their fines. People might be more likely to pay their fines in a timely manner if they can use a credit card.

    @balthisar: It can be a cash advance even if it’s processed in some other way (ie, as credit, or via a convenience check). It mostly just matters where the transaction originates. For example, most banks will treat “cash equivalent” purchases, like chips at a casino, as cash advances. That kind of makes sense, in a way, because they want to discourage people from using that as a loophole to just take money out of their credit line (since you could sell the casino chips or whatever for real cash). But it seems just stupid for a bank to treat a parking meter transaction as a cash advance…it’s not a cash equivalent, and it’s clearly a purchase.

  31. esd2020 says:

    @balthisar: Not quite. Purchasing cash equivalents on a credit card (e.g. casino chips) counts as a cash advance.

  32. backbroken says:

    @SadSam: DING DING DING!!! That’s exactly right.

  33. Concerned_Citizen says:

    Why doesn’t the government ban credit card fees instead of just weaseling their way out of them and allowing all other businesses to be screwed? Percentage based credit card fees are a business tax and they need to be made illegal.

  34. ab12 says:

    That has to be the most incredibly perfect picture I have seen here.

  35. johnva says:

    @Concerned_Citizen: Well…I can see both sides of that argument. You’re right that most of the time a $2 transaction costs the credit card companies the same amount to process as a $10,000 transaction. So in that sense a flat fee would be more fair. But there is also the liability risk and greater exposure to fraud associated with large transactions. The credit card-issuing bank might be risking more of their own money, if it’s a fraudulent transaction, by processing a larger transaction. (I understand that some of that liability gets pushed onto merchants, but it’s not supposed to be if they follow proper record-keeping procedures). So in that sense I can see why a percentage-based fee might make sense. But doubtless the interchange percentage fees charged to merchants are excessively high. No argument from me there – that’s pure profit for the credit card companies.

  36. straight_up says:

    I’m getting charged $3 fees every month by BofA and I don’t know why. I’m going to call and complain soon – and then leave them!

    Who (with Arizona branches) should I turn to? Is Wells Fargo or Chase ok?

  37. johnva says:

    @straight_up: Did you call and ask them? If it’s a checking account, it’s probably for not meeting a minimum balance or direct deposit requirement or something. They do have checking accounts that don’t require those things.

  38. starbreiz says:

    This can’t be that hard of a thing for them to fix… I have Wells Fargo, and I use my card all the time to pay at parking meters. I’ve never incurred any type of fee outside of the $1-$2 payment for parking. (I just double checked my charge from this past weekend)

  39. BankOfFees says:

    Call Tyson Price in the Executive Office. His number is 480.225.1310.

  40. Optimus says:

    @straight_up: Something is seriously screwed up with the Consumerist comment system lately. This makes two windbag comments of mine that it has just eaten.

    Summary:
    -Credit Unions good
    -Loosely linked with Armed Forces better
    -Redstone Federal Credit Union even better
    -$3 fee for emergency transfer from savings on zero balance debits. Only $3 now because when free everyone was filling their savings and emptying checking to get the higher savings interest rate.
    -Me = relieved to be banking with the good guys when I see posts like this.

  41. Optimus says:

    Okay… weird…
    I refreshed and my original comment appeared in the comment box…

    @straight_up: Find an loosely Armed Forces affiliated credit union (or maybe any credit union since I’m speaking from anecdotal experience). I’ve been with Redstone Federal Credit Union since my paper route at 12 yrs. old (16 years ago) and they have free, no-hidden-fee checking and I’ve yet to see them so much as suggest that they might allow transactions past a zero total account balance.

    I say “total account balance” because they do charge a $3 emergency transfer fee to transfer from one’s savings when a Debit Card transaction brings the Checking past zero. They always snail mail a notice for this. I wouldn’t be surprised if they’d email, but I’ve never given them my email address. They used to do the emergency transfers for free, but I think they were upset with how that encouraged people to keep all their money in savings (to get the higher interest rate).

    They’ve never been anything but helpful within their legal abilities. (I.e., at one point in this messed up state [AL], it apparently became illegal remove a secondary name from your bank account without their consent. That’s been fixed very recently. My paper route account still had my brothers and father on it until about a month ago. It’s a pain to go around and get notarized signatures from family members who work… and I’m too lazy to be bothered to.)

    Everytime I see posts like these about all the non-credit-union banks out there, I get a big sigh of relief that I was blessed to be working with the good guys.

  42. Coder4Life says:

    This is the stupidest thing i’ve ever heard.. BOA should be sued for this..

    How do these people sleep at night seriously whoever made this up?

  43. Ein2015 says:

    Amazing picture!

  44. straight_up says:

    @johnva: I haven’t asked yet. My understanding is, I have a student account, and shouldn’t be subjected to those fees.

  45. azntg says:

    Bank of America should really go for a corporate name change. Just imagine:

    BoO – Bank of Opportunists. How fitting (TM).

    @ab12: Agreed. Excellent picture choice Alex!

    @straight_up, johnva: Actually, a recent Consumerist article mentioned about how even if the customer is meeting those basic requirements, BoA still charges the customer as if those requirements haven’t been met!

  46. flyairdave says:

    I call them Bank of Fees.

  47. johnva says:

    @azntg: Only when people’s accounts were set up in some incorrect way. They don’t do that to me, and never have. The only thing I’ve seen them do to me that I considered somewhat shady was that they automatically “upgraded” my account type to one that had a minimum balance requirement (and some additional features, like interest-bearing) when I left significantly more than that minimum balance in my free checking account for a long time. I complained and they immediately switched it back (they said they do that as a “courtesy”, but it could result in people paying fees if they decide they don’t want to keep so much money in there anymore).

  48. highmodulus says:

    Satan’s Bank. If they don’t make the finals of worst company of the year, the process is broken IMHO.

  49. scottywz says:

    @johnva: You’re being a little too nice to BoA with how you described that “courtesy.” That’s just fraudulent of them to do things like that. I’m so glad I just closed my accounts with them.

  50. johnva says:

    @scottywz: I’m not being “nice”. I said it was a little shady. But like I said, I tend to pay attention to my accounts and I noticed it right away. And they didn’t argue with me or give me trouble when I asked to have it changed back. So it wasn’t that big of a deal.

  51. krom says:

    I would like to hear exactly what the CSR said and what Gary asked her instead of Gary’s second-hand, anger-filtered paraphrasing.

    Didn’t Cist cover an extremely similar story before about parking tickets in a city, and the fault was actually with the city for the method they used to handle the transaction?

    Good journalists check the morgue first.

    Not that today’s successful bloggers feel the need to be good journalists any more than today’s successful journalists do…

    Oh, look, thanks to MovableType, I can do the onerous legwork myself:

    [consumerist.com]

    Sounds REALLY familiar!

    I suppose a good journalist would also do follow-up and further research, but that’s sooo Old Media!

  52. krom says:

    PS Where’s the email Gary said he attached? Hm?

  53. Alex Chasick says:

    @krom: Thanks for the incredibly snide comment. To answer your question: no, the fault was not with the city for the method they used to handle the transaction. Apparently Bank of America’s terms of service do say they treat fines as a cash advance but parking meters≠parking tickets or fines, so no, these are not the same.

  54. johnva says:

    @Alex Chasick: I’m wondering if the city is processing the parking meter transactions through the same merchant account used for accepting payment of fines or something. Seems quite possible, given that it’s probably the same department at the city government. If they’re doing that, how would BoA be able to tell fines apart from the meter fees?

  55. Alex Chasick says:

    @johnva: I could see that being the case, although it makes me wonder what else gets charged on that account (like zoned parking permits, for example). If that is the case, cities need a better fix than a warning on their website; they need to stop using the same account (or Bank of America can stop treating fines as cash advances).

  56. TechnoDestructo says:

    @EBone:

    @straight_up:

    If you’re going to go with a major bank, Wells Fargo is the one to go with. They aren’t completely free of questionable big-bank practices (keeping closed accounts open to new charges then charging overdraft fees) but they’re better than the other major banks.

    A better option if you intend to stay in AZ is a credit union. Not sure what ones are the most widespread. Actually, I’m in AZ, and the only bank account I’ve got is a credit union in AK. It could work wherever you are. But if they’ve got ATM refunds (mine doesn’t…I just don’t use them) it would make a credit union about as good an option as an online bank wherever you go.

    And many online banks have partner banks whose ATMs you can use fee-free. They offer better interest rates than even credit unions do.

  57. TechnoDestructo says:

    @EBone:

    I’m pretty sure BofA is a major shareholder in both Visa and Mastercard. So if you’re using either one, they’re probably getting a piece of it.

  58. Angryrider says:

    Ha ha! No BoA for me!
    Besides, they’ll blame the Government for their $10 fee, giving some insipid reason.

  59. razremytuxbuddy says:

    Someone may have pointed this out already, but…using BofA’s interpretation of this parking meter transaction as a cash advance, wouldn’t every credit purchase ever made be a “cash advance”?

  60. SOhp101 says:

    Just curious, but did the OP use his PIN? If you ever use your pin when using a credit card, you’re using the cash advance feature. But there are some cards that make cash advances extra ‘convenient’ for you, and maybe BofA CCs are some of them.

  61. MFfan310 says:

    @Jesse: And you might want to check who does issue your credit union’s credit card: A lot of credit unions here outsource their Visa/MC/AmEx credit card products to FIA Card Services, a division of (surprise!) Bank of America. I kid you not… I’ve checked.

    If FIA issues your credit union’s cards, I couldn’t imagine that their fees would be any different than the average BofA card.

  62. KarmaChameleon says:

    @kepler11: I use a credit card to pay for shipping on eBay transactions all the time (it helps me keep track of things). Never been socked with a cash advance fee, but under this logic I should be. BofA is really grasping at straws trying to define that as a quasi-cash transaction. “Quasi-cash” is for things like wire transfers and gaming chips/gambling. Under that definition pretty much transaction could be “quasi-cash”.

    Well they got rid of soap and coffee for their employees, they’ve got to make up that subprime shit somehow.

  63. Nytmare says:

    So take the normal merchant 25 cent plus 3 percent processing charge and you get a 31 cent fee. That’s kind of different from 10 dollars.

  64. ksnicholas says:

    Something similar happened to me. I made a purchase through PayPal with my BoA Visa as my funding source, something I have done many times before with no problem. This time when I got the bill there was a $10 same as cash fee. These fees must be new because the CSR I spoke with kept insisting that the fee must have come from PayPal, not them. Eventually, he put me on hold while he spoke to someone, and when he came back he admitted the fee was from BoA. He did waive the fee, but said that they would not waive the fee again since I now knew about it.

  65. vancedecker says:

    @johnva: John, how can you see both sides of it? What is the other side exactly? The transaction cost of $10,000 is the same as transaction cost for $1, so what? What difference does it make when that transaction cost is close to zero? There is no other side to consumer fraud. Go write yout ‘balanced crap’ somewhere else, be a man, and take a stand one way or the other.

  66. johnva says:

    @vancedecker: What I’m arguing is that while the cost of individual transactions is essentially equal, there may be more loss to fraud associated with large transactions because the potential loss from that single transaction is much higher. So the average cost of larger transactions may be higher, even if the individual cost isn’t.

  67. krom says:

    Alex: You still haven’t posted the email that the OP says he attached.

  68. Jesse says:

    @MFfan310:

    Thanks for the tip!

    I go through US Bank right now, but am considering a local credit union which supposedly has a e-checking account that yields 2.5% APY (I think the pulled an Office Space and misplaced a decimal though). If true, that combined with my high yield online savings account will be a decent utilization of my cash vs. what it’s doing now at US Bank (0% and .10%.

  69. aerick says:

    why would you use your Credit Card at a parking lot. Maybe if you have award program. yeah that’s just dumb

  70. LAwebHead says:

    BoA is THE WORST! Have been for years. Wells Fargo seems to be trying to hard follow in the footsteps of their business model also. I dropped BoA over 12 years ago here in Los Angeles for the credit union and never looked back. Years later, when BoA started charging you $5 to cash a check written from one of their customers checking accounts if you didn’t have an account with them I knew I had made the right decision. Let’s face it, we all have people who’s checks we cash at their bank to save fees at ours if their check bounces! Preceeding that, they had it where you could only cash the check at that person’s branch. I’m not even religious and I see that the temple of America is full o’ money changers. One word – DEREGULATION of the banking industry. Thanks Reagan/republicans. Same with the Airlines. Let me define DEREGULATION – “companies are free to screw people over with any idiotic idea that comes to mind.” I’m all about a free market place, but there has to be a line drawn somewhere when corporations get mercinary and take advantage. Yep’… another LONG LOST BoA customer here to. Companies know one true thing – people are sheep who don’t like change!

  71. rikkus256 says:

    He should put up the “I hate Bank of America” banner on his wall.

  72. ryanoscerous says:

    My fiancee and I will be leaving BOA for a local credit union. Until federal governing bodies stand up for consumers we need to walk!

  73. FilthyHarry says:

    As the economy tightens look for all companies to screw their customers over to help themselves out.

    I can’t believe people think a ‘free market’ in today’s world is good for consumers.

  74. varro says:

    Two different comments from B of A people on this one…and there’s a big difference between what the CS Rep says to a normal person and what the Government Relations person says to a city employee….

    Much thanks to Amy J. Ruiz of the Portland Mercury for the legwork here…

    A response to my e-mail to B of A:

    Thank you for your inquiry dated 6/29/08 regarding (your card). We are happy to
    assist you.

    You may access cash with your credit card up to the credit line; however
    please keep in mind of your transaction fee associated along with each
    cash transaction.

    Bank of America will now convert charges from parking meters, court
    fines, and parking tickets into a cash charge.

    The transaction fee for each cash transaction is three percent with a
    minimum of $10.00 and no maximum cap.

    We appreciate the opportunity to assist you online. Should you have any
    further inquiries, please e-mail us again. Thank you for choosing Bank
    of America. We value your business and look forward to serving your
    banking needs.

    (shill), Bank of America

  75. varro says:

    But here’s what happened when Ms. Ruiz talked to a City of Portland employee who then contacted B of A…:

    (B of A Rep) said that there was an issue early this year whereby some municipalities were encoding parking meter transactions incorrectly. The issue was identified and corrected by May 5.

    Bank of America does not charge a cash advance transaction fee to use parking meters. Parking meter payments are treated as purchases. There is no associated fee for this transaction.

    Below is the actual statement she said that their Government Banking Merchant Group sent her regarding the payment of parking tickets:

    “Bank of America does not consider payments of parking tickets as cash advance fees. There was a coding error for a brief period in April and we worked with the District of Columbia to correct it and credited any fees back to our customers.”

    As far as we know, there was no such problem in Portland.