“Don’t overdraw your bank account” is pretty sound advice. However, reader Phil advises that if you do happen to overdraw your HSBC account–even by a few cents–the bank will mercilessly close your bank account with no warning. That’s what happened to him.
I logged in to my HSBC account today (8/17) to discover that my business checking disappeared.
I called HSBC and learned that they closed it on 8/12 because the balance has been MINUS 14 PENNIES during the whole month of July.
I never got any communication at all from HSBC about the closing of my account, or any warning.
Talk about “standard of world class service”!
Phil didn’t give this much thought since he had overdraft protection for the account set up with an HSBC credit card. Talk to local branch staff. When I was an HSBC customer, I found useless customer service reps on the phone, but amazing service in local branches.
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Don’t overdraw your account??
Just like the first sentence in this article!
Yeah, 14 cents, 14 dollars, 14,000… they will close any account that’s negative for 30 days. Probably reported the 14 cents to a collection agency too.
The agency bought it for a dime, says the OP owes them a quarter.
‘m gld y pst hr. Tht dvc s s hlpfl. t’s sh!t lk ths tht mks m wnt t lv th Cnsmrst, whch sd t b m fvrt wbst. Hw bt ffrng sm nsght nstd f jst bng d!ck y d!ck.
+1
I don’t see you offering any better advice.
“the bank will mercilessly close your bank account with no warning”
So, the bank decided that a customer who was overdrawn for an entire month, and obviously didn’t use the account for that month (otherwise the overdraft value would have changed at least somewhat), wasn’t a customer they wanted. Hardly merciless.
Um…. this was left for a MONTH? Overdraft protection is just to make sure the transactions go through, not a free pass to sit owing them money for a month. If your “business” account is so dead that you don’t even care to add a dollar into it for over 30 days just to get the balance in the green, then yeah, buh-bye. Save the banking complaints for people who are actually getting screwed.
It sucks that the bank didn’t tell the guy, but really, he didn’t actually seem to care. I’d be mad if they didn’t tell me and closed it in less than a week, but beyond that WE should be checking our own accounts, not passively waiting for the bank to reach out to us and hold our hands.
He didn’t care because nobody told him there was anything wrong. A bank that notifies you when anything goes right would bury you in paper, so all banks are configured to warn when things go wrong instead. Something went wrong, the bank sent no warnings, so the OP reasonably and properly knew that nothing had gone wrong. And if nothing has gone wrong, why worry/care?
Even if he had been warned about the negative balance, he didn’t need to care much, since he also had arranged an automatic process on the bank’s end to correct such problems without his intervention. He wasn’t warned that the bank had dropped the ball and failed to utilize that automated process, but he knew the bank would warn him if anything went wrong. The bank didn’t warn him, so he knew he didn’t need to worry about problems, because none existed (if any did, he’d have been notified, after all).
The OP’s first warning that he needed to intervene was the warning that his account had been closed. By then, it was mostly too late.
As the article notes, he had overdraft set up with an HSBC credit card. So when the overdraft occurs, they zero out your cheking account balance and cover the difference with a cash advance on the cedit card. So it shouldn’t have been in the negative for a month.
If they are anything like my bank, overdraft fees would go into an Overdraft account that is separate from the checking and savings account. Any transaction to checking and savings account would not change the amount in the OD account.
And yet, curiously enough, they don’t do this in their “home” market (that is, one of the cities that’s part of their name). I know of an account that was allowed to sit there for at least six months. Regular statements kept arriving, too. So why a different policy overseas?
Sorry OP but if you just went over 14 cents and did not touch the account for a month afterwords, I feel like you knew the account was overdrawn if not you would have spent more and ended up with more negative transactions……on another note I kept my USBank account at $3.51 for an entire year…..
Welcome to software monitoring.
….also, being a BUSINESS account, he’s probably contracted to “analysis” requirements when the account was opened. Go to a zero-dollar balance (or less!) at the END of the monthly cycle, and it will automatically closed. OP may have ‘forgotten” that part of his disclosure agreement when he chose to open a biz acct.
at 29.99% interest he will need a payday loan to cover this monster amount owing to the bank
You know, he’s actually lucky that it stayed at 14 cents.
I overdrew my personal account several years ago. I think the overdraft was $70 or something. I didn’t catch it for a week or so, and by that time, I had overdraft fees, fees on top of the overdraft fees for overdrafting even more, and then carrying fees for being negative for more than 5 days. I wasn’t making a lot of money, and I couldn’t afford to pay it all at once. A month later, I ended up paying the bank $1,200 and change for what was originally a $70 overdraft. Needless to say, I closed my account. That’s when I switched to Bank of America, and while they have their problems, I’ve never had an experience with them like I did at my “nice local bank.” I even filed a complaint with the Department of Banking in my state, but they never even responded.
No kidding. My bank will charge $5 a day if you are overdrawn for more than 5 days. That would become a hefty fee after 30 days.
If the OP was overdrawn and not covered by overdraft, is there a chance this was a fee from the bank that dropped him to that balance?
Maybe, if he was 1 cent overdrawn, and the fee was 13 cents.
Or he had a balance of $14.86 and was charged a $15 monthly fee.
And usually when you go under because of a fee, they will close the account.
I hope the bank makes payroll this week after suffering with the $.14 unpaid loan they made to this deadbeat.
we should have let them all fail but instead they are provided with 0% loans that they then turn into 2%, US taxpayer guaranteed, investments. $100,000,000 interest free loan invested in a guaranteed 2% return leaves the bank with only $2,000,000…before overhead, of course. Makes their balance sheet look really healthy! fucking scum bags should be hung.
Truly, you are better off without them. I was a happy HSBC customer for well over a decade (going back to when they were called Marine Midland) but they screwed up royal in a series of events that culminated in an overdraft that shouldn’t have happened.
Ultimately, however, I got all the overdraft fees back by annoying the lady at the executive customer service line (making it clear that I would go away when the problem did) and then did the reverse of what they did to this guy — I closed the account because of overdraft.
Now. . . about all the “don’t overdraw your account” posts…. glad you guys are perfect and never make a mistake. It must be truly a blessing. Pray, show some mercy upon us mere mortals and STFU.
No worries, simply write another check. That will magically open your closed account instantly. As we’ve learned from previous posts, closing an account isn’t really closed. As soon as someone tries to take money from your closed account, it will magically open and allow the overdraft. Again, your account isn’t really closed.
That’s what I am thinking…..It shouldn’t be hard to reopen the account again. Is it really difficult with HSBC to open an account? Last time I opened a bank account I was done in 5 minutes.
I’d love to have some of my old checking accounts closed right now. One will not go away – keep getting statements that show 0.00.
It just amazes me how someone can write about a legitimate problem on this blog and people will comment and beat their chests and bellow how smart THEY are and how THEY never would have done it that way or how the ignorant victim SHOULD have done it or how it’s all the victims fault. Very few comments are helpful, insightful, or even intelligent. Incredible.
I was once like you. I used to get indignant about it any time I saw folks dare to take the OP to task. It just seemed completely counter-productive to the spirit and the purpose of this site. Then I came to my senses and realized that while I had idealized this place a great deal, the reality of things was quite different. The fact is that not every story that gets posted here is legitimate as I once believed was the case. Sometimes the OP’s problem is one of his or her own making. This is one of those times.
The fact is that while the overdraft possibly may not have occurred by any fault of his own, that the OP didn’t check his account for well over a month certainly contributed to the problem. If he had done his due diligence, he could have caught the overdraft and dealt with it before it led to the closure of his account. It would be great if we could expect that our banks will notify us when our accounts go into the negative as a rule, but even if they did, it would still be the account holder’s responsibility to keep tabs on his account. The OP didn’t even notice that his account was closed until five days after it happened, so I can’t really see why anyone ought to blame the bank for this one. If he takes anything from this ordeal, it ought to be to monitor his accounts better, because the bank isn’t going to do it for him. That’s not something I’m saying to assert superiority over the OP, or because I think I’m smarter than he is, it’s just a simple statement of fact.
I thought all banks sent statements every month?
With Bank of America, I no longer get paper statements, but I get an email and a text message saying that my new statement is available to download. So I’m sure he had to be notified in some way, he just didn’t bother to do anything about it.
Hello everyone, I am Phil the OP.
Let me add a few info:
1) HSBC charges me every month a $12 “service charge” fee. Well, WHERE IS THE SERVICE? I got absolutely zero communication from them about this 14 cents overdraft. As of today, one full week after the account was closed, I still have not received any communication from them informing me that the account is closed. That, from a customer service perspective, is absolutely inexcusable, and this is the point that anger me the most. Apparently that $12 will not get you more than a monthly statement in the mail.
2) I had this account for more than six years with months of inactivity because my business is dormant during summers, hence this is not the lack of transactions that triggered the closure but really the 14 cents overdraft. To close an account over such ridiculous amount of money is already infuriating, it’s even more when you have a credit card linked to it to cover overdrafts and it happens anyway.
3) Apparently some people commenting here are not reading the last paragraph: my credit card is supposed to cover that 14 cents overdraft
People here don’t read. They prefer to rage at the OP.
Why can’t you just open a new account?
1) Did you sign anything when you started the account that says the service fee that you’d be paying would entitle you to additional services such as overdraft notification? I’m not saying you’re wrong to think that the bank should notify you when your account goes into the negative, I’m just wondering where you picked up the idea that paying a service fee obligates them to do it.
2) Setting aside the question of whether or not they were obligated to notify you of the fact, your account was overdrawn for an entire month. Be it by 14 cents or 1400 dollars, that’s all they care about. That said, I don’t get the impression that they closed it due to inactivity either. Just the overdraft that sat in your account for a month.
3) The bank definitely screwed up, and you should go after ‘em to get the resolution that satisfies you. However, if that point seems to have gone ignored, it’s probably because you appear to believe that it absolves you from the responsibility that you have to monitor your accounts on a regular basis. As you can see by your current ordeal, measures like this don’t always work. It’s a good idea to keep tabs on your accounts just to be sure that everything is going smoothly. So yeah, the bank is ultimately at fault, but you gotta share a little of the responsibility for your current predicament.
Bank fees are not usually covered by overdraft.
I wonder if there are other variables at play going on. Maybe it wasn’t the overdraft but the fact that the account had no activity for a month or because it was a business account.
What did HSBC say when they were contacted?
@ mmrosek
I don’t disagree with the sentiment expressed in your post, but for as much of a smug ass as Watcher95 comes across, he/she/it isn’t exactly wrong. Don’t want your account closed, don’t overdraft. This story is only really unusual due to the small amount involved, but that aside, it’s nothing out of the ordinary.
it is also about the complete lack of service from HSBC. You pay $12 a month to keep that account open, and they close it without any warning.
Yeah, for $12 a month, they can shoot you an email if your account goes over.
umm.. well your account is closed look for a new bank really
the bank had to clear a non-performing asset, even if it was OD 14 cents. this is part of proper accounting.