BofA Customers, Watch Out For Overdraft Protection Auto-Enrolling

Will was meticulous about avoiding the succubus that is overdraft protection in his Bank of America checking account. So you can imagine what happened to him: The bank automatically stuck him with the so-called protection thanks to an automatic function that stuck him with a $100 credit card cash advance, along with the accompanying finance charges.

He writes:

I have always been careful not enrolling in overdraft protection. Last week, i was switching between two BoA checking accounts because the new one I opened online includes no minimum balance fees. One of my bill pay orders attempted to remove the money from my BoA checking account–which had zero balance–and BoA “helpfully” protected me from the overdraft by using my CC for a cash advance of $100. I called up customer service and requested they waive it and tell me when I enrolled. They waive it but could not tell me when I enrolled.

At least in my case, BoA isn’t just ignoring the new federal law about optin overdraft protection, they are now making the protection come as cash advances from CCs.

If you’ve encountered a bank’s sneaky overdraft protection conscription methods, let us know about them in the comments.

Comments

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  1. montusama says:

    I thought the picture was a bottle of beer :(

    • KhaiJB says:

      it is….

      • Loias supports harsher punishments against corporations says:

        It’s “Premium Cola”

        • KhaiJB says:

          they put the word Draft on cola???

          oh thats low… dishonest…

          (in the UK draft is put on Beer….)

          • Loias supports harsher punishments against corporations says:

            I believe draft means from the tap or keg.

            So, be it beer or cola, writing draft on a bottle is bullshit either way.

    • dirtyblueshirt says:

      it’s RC’s “Royal Crown Draft” cola that was out in the early-mid 90′s. The taste difference was kind of like the difference between A&W Root Beer from a can versus A&W Root Beer drafted at their restaurant. Good cola, very short lived.

  2. brinks says:

    BofA customers, watch out for BofA.

    • smo0 says:

      Exactly… why the f*ck are you guys still banking with them!?

      • Merricat says:

        In my case it’s because my account was with Boatman’s Bank, who was acquired by Nations Bank, who was acquired by Bank of America. And while I could slash and burn to get away from Bank of America, I’ve discovered that the real problem is banks and credit unions and any other financial institution is greedy and prone to act in it’s own interests, regardless of it’s size or wealth. And as such, I prefer to avoid jumping ship till the water level is high enough that elsewhere really will be a better location as opposed to a theoretical improvement.

    • vastrightwing says:

      Exactly. You people, who insist on letting BoA mess all over you deserve what you get: POOP!

      Yep, it’s well known now that BoA will POOP on you. If they haven’t yet, they will soon enough. In fact, I just laugh now every time I read yet another BoA horror story. Get with the program. Now I don’t feel bad for BoA customers because if you are still a customer, you’re just waiting for them to POOP all over you. And the last one to leave with get it more.

      People just don’t learn. And it’s not the public schools.

  3. Juan_Figs says:

    BoA has been doing it for years. When I got my BoA credit card almost 10 years ago they automatically opted me in to link my BoA credit card with my checking account to cover any overdrafts might happen. Thankfully I never had to make use of the service and I opted out about 2 years ago when money started getting tighter and I realized an automatic cash advance is a pretty tempting alternative to keeping a closer eye on your expenses.

  4. PLATTWORX says:

    I have BofA for almost everything. i bank almost always online or at the ATM and have had little trouble. However, the rare occasions I do (escrow issue, etc.) you have to slap them on the head to get their attention.

    • BrianneG says:

      I’m in the same boat. I rarely have a problem with them and they’ve been my primary bank since I moved to Southern California and they had a branch immediately across the street from campus. But I got married and changed my name this summer, which meant not one but two trips to the bank with my original marriage certificate, new social security card, and new driver’s license in order to get my name changed. And even then they didn’t think I wanted a new debit card so I had to call and ask for one. Another girlfriend got married this year and it took her FOUR trips to the bank to get them to process the name change, so I actually got off lucky. Chase did it the first time and the receptionist was able to do it in about five minutes. Each trip to BofA took about an hour including the long wait for an available agent (not a teller).

      • Loias supports harsher punishments against corporations says:

        To reinterate smo0s comment above:

        “[W]hy the f*ck are you guys still banking with them!?”

      • ElleAnn says:

        I had similar issues with a name change at Bank of America. About half of our wedding checks were made out in my maiden name and the other half in my married name. Bank of America said that I could deposit all of them, but if any were sent back because the name didn’t match the name on the account, we would be charge $20 a check. The manager said she couldn’t promise me they would go through or waive possible fees. It took over a month after the wedding for my name change to be official (had to wait on the marriage license then the new social security card and then make it to the DMV on a day I didn’t have to work)… and finally we were able to cash the other half of the checks. Doesn’t BOA have to deal with people changing their names EVERY DAY?

      • vastrightwing says:

        It’s only a matter of time. It’s kind of like walking on thin ice, sure, you may not get hurt right this minute, but eventually the ice will break, you’ll go down. But, hey, they make funny stories on the Consumerist now. So keep your account open a little longer so we can find out what they’re going to do next. I can’t wait to hear.

      • akiri423 says:

        I had this same experience – I ended up with a stack of debit/check/credt cards with my old last name, even though everything in their computer said they had my new last name on file.

      • BridgetPentheus says:

        Don’t change your name, much less hassle, it’s so antiquated anyway

    • Warren - aka The Piddler on the Roof says:

      Someone should slap you on the head.

      Why are you still banking with them?

  5. DariusC says:

    “If you’ve encountered a bank’s sneaky overdraft protection conscription methods, let us know about them in the comments. “

    Screw reporting it in the comments, call the police and let them know that your bank is scamming you out of your money.

    Of course by police I mean the proper authorities.

  6. Beeker26 says:

    Wachovia tried a similar stunt with me in regard to moving online bill pay from one account to another. Tho I made a point of switching all payees to the new checking account, when it came time to make the payment they all magically reverted to the old account that had no money in it. To the tune of $440 in overdraft fees, which of course they expect me to pay. Silly, silly Wachovia. They can go scratch my ass. Needless to say I’m no longer a customer.

    Word to the wise — if you open a new checking account with the same bank and try to switch over online bill payment, DON’T. Either close the old account first or cancel the bill payments until you do (making sure the old account isn’t even an OPTION). Otherwise you’re just asking for trouble.

    • BobOki says:

      I can one up that for my out the Walkalloverya out the door story. The straw the broke the camels back for me was their save the change, which I did not enroll in, in where they cashed my checks first, which brought my balance down to about $.12, THEN proccessed like 6 save the change for $30×6 overdraft fees, THEN deposited my incoming checks. Somehow $180 in overdraft ballooned to nearly $500 to “keep my account open”. I talked to the manager, she said nothing she could do, so I talked to the GM, nothing she could do, so while still in the lobby of the store, making a VERY large scene (got three others to close their accounts) I contacted the secretary of the pres, who herself told them to give my money back, I then closed my accounts on the spot.
      A week later I get a call from wachovia saying they went ahead and allowed payment of three more drafts (I had already paid the companies but they drafted anyways… that’s another story) on a closed account, which because it had no funds required them to do another overdraft fee on each, which caused a overdraft fee because there was no money to pay the overdraft… up to like $1200 on $65 in drafts. I politely informed them that as of my close date I no longer had a bank account with them, I gave no permission to allow any drafts of any kind, and they would not see a penny of money from me.
      I am still fighting the now $2000 in fees they say I own them on my credit, with again reporting as fraudulent coming back as verified debt.

  7. oldwiz65 says:

    BofA doesn’t worry about federal laws regarding consumer protection; they pay enough money to the members of congress and the regulatory agencies to leave them alone. The very idea that BofA should obey the law! Huh.

  8. AnonymousCoward says:

    I get the point that the guy probably signed up for overdraft protection without knowing what he was signing up for, which is indeed bad, but I guess I don’t really understand what’s so evil about overdraft protection in and of itself. I don’t make a habit of bouncing checks, but the once every year or two that I do, I’d rather pay $10 for the cash advance than to pay all the fees involved with actually bouncing a check.

    • Gort42 says:

      These aren’t checks. These are debit cards. Which would you rather have?

      “Oh, the card is declined? Ok, take this Visa”.

      “What? That transaction yesterday caused a chain of 10 overdrafts that ended up costing $350 in fees!?”

  9. deadandy says:

    Sorry for my naiveté, but what does BofA do if you opt out of overdraft protection and then overdraft? Do they simply not honor the transaction, or do they pile on even more fees? My point is, is it cheaper to accept the cash advance with fees, or pay all the overdraft fees?

    • Kevin411 says:

      Unless you opt in for overdraft, the debit transaction will be declined and you will be assessed NO fees. You may get a little embarrassed, but if you don’t realize the bank account is overdrafted and go debit-purchase parking, a coffee, lunch and a snack during the day you’re looking at $140 (4x$35) in overdraft fees. I’d rather be declined and either miss getting coffee or produce another form of payment.

  10. Extractor says:

    I was about to open that ebanking account to eliminate the 750 minimum but there are a couple things that I dont like.
    1. At the very end of the application,it states that a credit report will be pulled
    2. there will be a 9.95 monthly charge to download into quicken-same as if I did that on my current accounts.
    I would think that if that was an e account that there would not be a charge for the web connect. I have to manually do that only for BoA. Chase doesnt charge nor does USAA for that. And all but my BoA MC credit cards are free quicken downloads.

  11. keepntabs says:

    Let’s be clear about the law, it pertains to “courtesy bounce protection” for debit or ATM card transactions that occur at a POS or the ATM machine only. Banks can still choose to honor the payment requests of checks and automatic payments that would overdraft your account, and charge you the overdraft fee. The reason why the representative couldn’t tell you when you enrolled is because you did it by opening the checking and credit card accounts.

    I am not sure if you can opt-out of this service, but I think that you would have to implicitly inform the bank that you don’t want this type of protection either, but I don’t know if it has to be in writing or not; you should confirm with your bank.

    • rooben says:

      So how is this different from overdraft protection, that you now have to opt-in for?

      • mac-phisto says:

        keepintabs is right – the “courtesy overdraft protection” that you must enroll in only applies to ATM/debit card transactions. furthermore, it does not require opt-in to “overdraft lines” (though this is considered a “best practice” by bank regulators).

        this situation isn’t governed by the new regulation b/c 1) it wasn’t an ATM/debit transaction that overdrafted the account (it was a “bill pay order”, which is presumably a draft by check or EFT) & 2) they didn’t charge the OP courtesy overdraft fees – they offset the balance owed by charging a line of credit (which doesn’t fall under the new reg E provisions).

        sorry.

    • webweazel says:

      We just got burned by this. Haven’t overdrafted in years and years, but had a slip up recently. Evidently, the mortgage check lined up in the queue on a Friday. (Notice I didn’t say PAID.) Made 2 check card transactions over the weekend. On Monday, the check went through, then the 2 CC. Got fees on both CC. I was livid, because we were careful to stay opted-out. We WERE opted-out.
      The way the bank explains it, the transactions went through on the weekend when there was enough there, because the queued check wasn’t subtracted, just PENDING. When they caught up on Monday, the balance went over. If I remember, CC trans are “must pays” because of the immediate autorization. So, my next question is, if it’s immediately authorized, why is it not immediately paid/declined?
      So, the only conclusion is, the banks only turn on the computers Monday to Friday, 9-4. I guess the banks don’t want to pay their servers for overtime.
      So watch out! Being opted-out doesn’t mean you won’t get trapped anyway.

      • mac-phisto says:

        banks can’t post transactions on non-business days. if they do, it becomes a business day (meaning they must also be open to process deposit operations). that’s why transactions only post to your account on weekdays & non-holidays.

        still, you may have an argument. if you are opted out, they can’t charge you fees in relation to atm/debit transactions. period. threaten to file a complaint with your bank’s regulator (either the OCC, the OTS or the NCUA). not sure who that is?
        http://www.helpwithmybank.gov/national_banks/index.html

      • keepntabs says:

        So, you didn’t know that you didn’t have enough money in your account to cover your card purchases and mortgage payment? It seems that you were depending upon the bank’s refusal of your transaction as your account balance monitoring system vs. knowing what you balance would be if you’d deducted the pending payment.

        The bank’s computers are on 24/7, but they process transactions at certain times (usually during non-business hours) and only on business days. Typically, a bank states that any transaction performed after 4pm on a business day, or on a weekend day or holiday will be posted the next business day. This is one of the reasons why you will often see items that are pending on your account.

        In the situation you described, the bank didn’t change any of its normal business practices to ding you. Actually, you were aware of a pending payment, but you chose to not do some simple math to calculate, and spent money without knowing your true account balance. I suggest you change your method of account tracking to be more proactive or you will likely be hit with some more surprises.

        • webweazel says:

          “So, you didn’t know that you didn’t have enough money in your account to cover your card purchases and mortgage payment?”
          “Actually, you were aware of a pending payment, but you chose to not do some simple math to calculate, and spent money without knowing your true account balance. I suggest you change your method of account tracking to be more proactive or you will likely be hit with some more surprises. “

          Thanks for contributing and kicking me square in the teeth. SHIT HAPPENS. Like I said, I haven’t overdrafted in YEARS AND YEARS, or did you miss that part? So, whatever I WAS doing was working except for this instance. Again, SHIT HAPPENS. Rather than raking me over the coals and dipping me in alcohol, get down off your damn high horse, and join the conversation. I’m glad I was so honored to be spit on by someone holier than the Pope, who has never made an error in their entire life.

          I’ve learned quite a lot on this site, and hopefully by posting what I did, others will be helped by it, even if in some small way. I like to help people and learn from them. Why do you feel the need to tear me down? Not cool.

  12. aja175 says:

    I never got an opt-in notice from BoA so I emailed support and requested that they opt me out of overdraft protection.
    Problem solved.

  13. sgtO says:

    Funny… I just got back from BoA not more than an hour ago.

    I had gone to my local branch early last week to consolidate two saving accounts then on Friday I got a letter from them saying that, per my request, my overdraft protection had been turned off.

    I went in this afternoon and spoke with the branch manager (nice lady) asking that she explain why it had been cancelled.

    I told her I was especially troubled since my overdraft protection is linked to a completely different account than the ones I had consolidated. She could not figure out what happened or why I had gotten the letter but assured me (showed me) that it was still on.

    Very weird and quite a waste of time.

  14. ncgirl says:

    The new law regarding overdraft protection only applies to debit card transactions, ATM withdrawals, and one-time bill payments. The bank’s individual overdraft protection policy, which you probably agreed to when you opened your accounts, applies to all other types of transactions. If this was an auto-pay bill or recurring bill payment, the new law does not apply.

    I don’t work for BofA, but this is true for all US banks now.

  15. wolskinj says:

    It is a common misconception that the new Overdraft Coverage regulations apply to all overdrafts. This is not true. The law only required changes to point-of-sale and ATM transaction completed with your debit card.

    Quoting from US Bank’s Overdraft Coverage Info Page: “Even after the new rules take effect, we’ll still provide standard overdraft coverage on certain transactions like checks, U.S. Bank Internet Bill Pay and recurring payments (i.e., gym membership monthly dues). Important: These transactions are eligible for overdraft coverage regardless of whether you choose to opt in to ATM and Check Card Overdraft Coverage.”

    I’m not saying that BofA shouldn’t have made that more clear, but they are well withing their rights under the new regulations to complete the transaction as the original poster erroneously requested.

  16. carbonero says:

    i have been banking with bofa over 10 years.

    I have no monthly fees as long as the minimum is kept.

    I watch my statement carefully every month. i download into quicken, no problem.

    It’s blasphemy to say it here but I have had no problems. What can I say, I keep a close eye on my finances and play within the rules.

    • carbonero says:

      ps, forgot to mention i have an ING account too. get one of those!

    • Extractor says:

      You download into quicken in the same manner as I do, manually for each account. Its the only bank or credit card that I use that doesnt have free web connect. So I can update 14 accounts with 1 click but with BoA I have to login and go into each accounts transactions page and click download and it screws up a lot since they have screwy dates filled in already. My wife has their web connect for 1 account $9.95 per month. What a rip-off. If it was an e-account, then web connect should be free. It should be free for every bank, every account. BoA wastes my time. We have DVR’s to save 22 minutes per hour zooming thru the damn commercials. Time is valuable.

  17. crb042 says:

    once again, the problem starts when a “bill pay orders attempted to remove the money”.

    Control the money on your end.

    For decades, how have people been paying bills? You send off a check. You say to your bank, “take my from my account and send it there”. That can be done electronically, but should not fundamentally change.

    Instead, people say “oh, you want my money? Here’s my account number, help yourself. Just don’t break anything, please.”

    (ok, this is still an annoying system for covering actual purchases. I’m not going to disagree with that.)

  18. The Marionette says:

    I haven’t been enrolled in it yet. The only thing I have are my autoalerts on where if I do happen to go over, I’ll get an email and text to my phone letting me know, but since i keep track of all of that myself I’ve had no reason to enroll in their overdraft protection.

  19. Rectilinear Propagation says:

    One of my bill pay orders attempted to remove the money from my BoA checking account…At least in my case, BoA isn’t just ignoring the new federal law about optin overdraft protection…

    The new law is ONLY for debit and ATM transactions.

    Write a check? Electronic bill payment? Anything other than a debit or ATM transaction? It can overdraft your account and they don’t need your permission for this. The law didn’t put an end to all overdrafts.

    …they are now making the protection come as cash advances from CCs.

    Is it just me or does that sound familiar? Hasn’t someone else complained to the Consumerist about this?

  20. Arcaeris says:

    i decided to switch banks last weekend, and switched from Wells Fargo to San Diego County Credit Union. They didn’t bring up the whole overdraft crap at first, even until I’d signed some things, which made me think they weren’t going to ask me at all.

    Oh man was I wrong. Not only did I have to get into an argument with the woman about not signing it, but she had apparently set up my new account as accepting overdrafts because she ASSUMED I would sign it. So she had to call some people to get it straightened out, because she had not expected my refusal.They told me to sign the paper with a statement saying, “I do not accept overdraft protection.” I told them I wasn’t putting any signature on any paper that might be construed as me accepting overdraft protection, and laid out clearly what the law said to them about the default being opt-out. At that point they dropped it, but I have no idea whether or not my account actually has overdraft on there or not now. I’ll have to call one of these days when I feel like being mad.

    I thought credit unions were supposed to be better than banks? I hate Wells Fargo, but they haven’t bugged me about this at all. This is the highest rated credit union in San Diego county, too.

  21. webweazel says:

    “So, you didn’t know that you didn’t have enough money in your account to cover your card purchases and mortgage payment?”
    “Actually, you were aware of a pending payment, but you chose to not do some simple math to calculate, and spent money without knowing your true account balance. I suggest you change your method of account tracking to be more proactive or you will likely be hit with some more surprises. “

    Thanks for contributing and kicking me square in the teeth. SHIT HAPPENS. Like I said, I haven’t overdrafted in YEARS AND YEARS, or did you miss that part? So, whatever I WAS doing was working except for this instance. Again, SHIT HAPPENS. Rather than raking me over the coals and dipping me in alcohol, get down off your damn high horse, and join the conversation. I’m glad I was so honored to be spit on by someone holier than the Pope, who has never made an error in their entire life.

    I’ve learned quite a lot on this site, and hopefully by posting what I did, others will be helped by it, even if in some small way. I like to help people and learn from them. Why do you feel the need to tear me down? Not cool.