Bank Of America Says It Has Stopped Creating Zombies From Dead Accounts

For years, we’ve been telling tales of terror abut bank customers whose supposedly dead bank accounts suddenly sprang back to life after some unwitting third party attempted to make a direct deposit or debit on the account. But realizing that this whole zombie thing is so overdone these days, Bank of America says it has put an end to the practice.

“We have been looking at [the change] since late last year and it just went into effect this week,” a BofA rep confirms to Huffington Post.

Among the many problems associated with resurrecting dead accounts (aside from the fact that’s in an offense against nature) is that the owner of the believed-dead account rarely finds out about the rebirth in a timely fashion. This can lead to the account being overdrafted, which means fees piled upon fees. It can also have a negative impact on one’s credit report.

In a recent report by our cohorts at Consumers Union, zombie accounts were listed as one of the impediments to making a clean switch from one bank to another.

“While this is a welcomed change in policy, consumers at Bank of America and other banks continue to face a myriad of obstacles that can make switching to a new financial institution a time-consuming mess,” says Suzanne Martindale, staff attorney for Consumers Union, about the Bank of America announcement. “That’s why we need Congress and the Consumer Financial Protection Bureau to enact reforms that make it easier for consumers to move their money.”

Consumers Union has called on Congress and the Consumer Financial Protection Bureau to consider a number of policy changes to enhance consumer choice and bank competition, including:

• Banks should be required to bear the responsibility for transferring a customer’s automatic payments and deposits from the old account to the new account within 14 days
• Banks should provide same-day electronic fund transfers at no cost to consumers
• Check hold times should be reduced so consumers can quickly access deposits in new accounts
• Banks should be prohibited from assessing unfair fees for closing accounts
• Banks should be prohibited from reopening accounts after consumers close them
• Banks should be required to provide consumers with clear and accessible account closing procedures
• Bank regulators should examine the feasibility of portable bank account numbers to facilitate easier bank switching.


Edit Your Comment

  1. Coffee says:

    Don’t think you’re being trendy when pirate accounts start springing up and looting money from everyone, BofA! Pirates are played out as well.

  2. Lyn Torden says:

    This should still not be a pardon for whoever thought up the stupid idea in the first place.

  3. dolemite says:

    I’m wondering if the change has anything to do with the Consumers Union and proposed legislation.

  4. Laura Northrup says:

    This BOA zombie graphic is pretty much my favorite thing this week.

  5. Jawaka says:

    I’m not sure if I like the idea of a bank automatically transferring automatic payments to a new account. It may take a few minutes to set them up but I’d much rather set up automatic payments myself. There’s too many companies out there who like to charge automatically for things even though you may have stopped service with them or they can no longer provide the service that they’ve promised.

  6. Banished to the Corner says:

    I completely and wholeheartedly disagree with the first three and the last proposal.
    • Consumers and their payees need to be responsible for setting up any deposits. My old bank needs to MYOB.
    • If I’m closing my account, my bank should have to pay to electronic funds and not be expected to be able to recoup these fees.
    • Check hold times are federally mandated, all financial institutions should always have to follow the law and regulations.
    • I don’t want my account (especially. if there were problems at another institution) number to follow place to place. If my number is stolen somewhere, I’m stuck forever with a compromised account number.

    I think the other three are excellent suggestions.

    • Banished to the Corner says:

      whoops! second bullet “…my old bank shouldn’t…”

    • AtlantaCPA says:

      Yea the first one seems ridiculous, the second one seems greedy (for a consumer to demand), and I see more downside than upside in keeping my same account number when I change banks. It’s kind of an odd list of demands, like they started out with a nice short list and then people started gloming on.

    • dolemite says:

      Why does that seem unreasonable? It’s all electronic. If I give you access to another account, you should be able to forward bills to it. This is like saying you are against cell phone companies having to port numbers over to new accounts. Why not? It’s not like it breaks their back to do so.

  7. Snowblind says:

    Zombies? At BofA?!

    WTF do they eat?! Pencil erasers?

  8. Milquetoast says:

    About 12 years ago, before automatic transactions from bank accounts were the norm, I got bit by a zombie account. When moving from one state to another, I “closed” my original account and opened one at a branch of the same bank in my new state (saving my rant on interstate banking bullcrap for another time). Because Internet banking was still in its infancy, it wasn’t as easy to tell what kind of automatic transactions you had set up. I was pretty sure I had all of them taken care of, and at the same time, I suppose I was pretty naive to think that I was actually closing the account for good. Many months down the road, I got a collections notice for $500 related to my old account — an automatic withdrawal of $25 + $475 in accumulated fees. That’s when I took to the phone and found out that there was no way to permanently “close” the account from the bank’s end. Looks like a dozen years later, banks are finally starting to get their stuff together.

  9. Difdi says:

    BofA is no longer making zombies? Great. But that’s like announcing you no longer molest goats. You shouldn’t have been doing it in the first place.

  10. lakecountrydave says:

    “This can lead to the account being overdrafted”, who closes an account and leaves money to cover any charges? Is not the idea of closing an account to remove all of the money and not use the account in the future?

    • Michael Belisle says:

      Nobody. It gets overdrafted when a charge is made to the account (reactivating it) or the bank starts charging its monthly maintenance fee. And then the bank is all like “you owe us $500” like the commenter a few posts above.

      • ARP3 says:

        …and to add to that, since your account is partially closed, you can’t see your balance, etc. So, a few months or a few years, later, you’ll get a creditor after you and maybe a ding to your credit since you had no idea that someone hit your account.

  11. Wayne from Indy says:

    BOA has a long history of screwing their customers (zombie accounts, monthly fees for ATM access, …). One of the worst was having their programmers sort customer check transactions from largest to smallest, so that if there was going to me an overdraft, they could get you for the maximum possible overdraft fees. Real nice… Whenever I get an ad from BOA, I use a black marker and write “Not if you were the last bank on earth.” on the application, and mail it back in their post paid envelope.