International ATM Mystery Fees

Since it looks like we’re having a Bank of America day, have another mystery. Gawker jocker Scott Kidder took a five-dollar hit to his BoA account each time he got out money in Europe. Painful, but in an ‘all banks ream you for international ATM fees’ way. But there were always additional percentage-based charge with each transaction, and the BoA customer care couldn’t tell Scott where it came from.

Scott writes:

The best part? My roommate John uses Bank of America, withdraws money from the exact same ATMs, but isn’t charged any of these fees! I’ve called BOA’s national call centers, my local branch, branches in other states, and everyone tells me the same thing: “Sorry, there is a $5 fee. We’re not sure why you’re being charged that second fee (the percentage), though. And we’re not sure why your roommate has no fees charged. Maybe you can give us his account number?”

Obviously, it looks like an additional transaction for overseas banking, but shouldn’t Bank of American be able to tell if the charge was levied by their system or another bank’s? And are there better ways to get cash in other countries besides travelers’ cheques?


Edit Your Comment

  1. The Unicorn says:

    I would keep at them, saying it’s bogus. After I got back from Spain, my Citibank account was overdrawn by over $100 worth of $2-$5 charges that, according to the statement, came from some sort of bridge toll system. All of the charges came through *after* I’d left the country, yet Citi claimed they were legit. After I hounded them a few more times, they changed their minds. So it could be something fishy they just don’t want to cop to.

  2. RowdyRoddyPiper says:

    BofA is staffed by idoits (I’m the mysterious Steve J from the overdraft story) so I’m not surprised that they cannot provide you a logical explaination as to the disparity between your roomate’s billing and yours.

    I especially like how they try to get your roomate’s account number from you…top class security there. Bank personnel should never solicit another customers information from you ex-parte. I would bring this up with BofA at the next opportunity.

    Below is a link to a reasonably good and recent article on ATM and Credit Card charges for international transactions. There are even quotes from BofA employees, chock full of their patented and totally clued in customer service mentality.

    Your 2.91 fee is almost exactly 1% of your transaction amount so it appears that it’s a currency conversion fee. A 1% fee may not seem that large, but let me put it into perspective. The smallest incremental move that a currency pair (in this case EUR/USD)can make is called a pip. Currency pairs are quoted down to the 4th decimal place so a pip on the EUR/USD is worth roughly 1/100th of a cent. Most large FX trades, like that used by your Credit Card Company have bid ask spreads in the neighborhood of 2-3 pips. That means it costs your bank roughly 3/100ths of a cent to exchange 1$ of your money. They however charge a 1-3% fee to customers for this service.

    There are of course costs to the bank outside of the bid/ask spread, but they aren’t much and they take minimal risk while exchanging your currency. Not a bad fee if you can get it. I’m still perplexed why you’re charged an additional fee that your roomate isn’t. Perhaps he’d been socking away some spare Euros in his bank account and wasn’t subject to a conversion fee?

  3. Another article on the topic is… – David Lazarus from the SF Chronicle who has been investigating this sort of thing, although with little success.

  4. I’ve had really good luck with BoA (getting an overcharge taken off, no questions asked) and think their customer service is good (after you get used to doing 99% of your banking through an ATM).

    That said, I feel your pain. I spent about $30 in ‘fees’ and I was only in Europe for 2 weeks.

  5. Scott Kidder says:

    Yeah, I was expecting the percentage fees for credit card purchases, but these are ATM withdraws!

    Thanks for the links.


  6. RowdyRoddyPiper says:

    Scott, I don’t know if you are still in Italy, but here is something you can do with BofA, online banking and the foreign bank of your choice. I was going to paste my transcript of the web chat with the CSR (who was really much more helpful than the phone CSRs I usually get) but there were enough not so subtle cross selling pitches as to make it 3x the necessary length. The Reader’s Digest Version.

    1: Open a bank account with a local bank in subject foreign country.
    2: Add bank account from step 1 to my accounts in online banking.
    3: Transfer money from BofA to Local account. Transfers were represented to me to cost $3.00 for 3 day service and $10.00 service. I can’t find any documentation on BofA site, so be careful. As a side note, the fees are waived for Advantage Checking accounts. I don’t have a money bin to swim around in so Advantage Ckecing is a bit out of my league.
    4: Withdraw money from your local bank using their. I don’t know if the US currency is converted to local when transferred from BofA to the local bank or if there is a fee associated with the conversion.

    The upshot is if you are stationed abroad for a longer period of time, you can save some ducats by opening a local account and replenishing it every so often. I’m going to have my wife try this when I send her to summer camp for naughty scandinavian girls this summer. I’ll report back with the results then.

  7. RowdyRoddyPiper says:

    The $10 service fee referenced above is for same-day transfers.

  8. HegemonyCricket says:

    The Unicorn didn’t seem to realize that these legitimate toll fee charges that processed *after* s/he left the country is a sign of credit card fraud. I’d hazard a guess that someone stole his/her debit card number and was using it in Spain. A similar thing happened to my fiance: Capital One actually called him to ask if he was spending $2 to $5 per transaction on railroad tickets in Europe, and when he replied that he’d never been to Europe, the credit card company said that it was a sign that someone had stolen is card number, and he needed to get a new card issued right away.

  9. henri says:

    using my credit union debit card while in Beirut Lebanon i was charged ZERO fees and was able to withdraw either US$ or Lebanese Pounds (at a very good exchange rate)

    not sure if this is due to the credit union or the atm owner (i’m guessing both) but i was _very_ happy