As we’ve noted multiple times over the years, some banks love to lump all transactions made by a customer during a day or weekend together and then process them not in the order they were received, but from largest to smallest. For customers on the brink of overdrafting, this can result in numerous fees that may have been avoided if the charges had been processed chronologically. In a rare bit of positive Bank of America news, the bank has decided to stop this high-to-low transaction processing (for many debit purchases). [More]
It’s been nearly three years since a U.S. District Court first ordered Wells Fargo to pay out $203 milllion in refunds to settle a class-action suit involving the bank’s overdraft policies. Since then, the bank got a U.S. Circuit Court of Appeals to set aside that mountain of cash, saying California law can not override federal banking laws. Now the original District Court judge is once again ordering the bank to fork over the $203 million. [More]
Sean’s Wells Fargo checking account dipped into the negatives on charges he disputed. He says Wells Fargo said he’d have nearly a month to sort out the issue, but it turned out that by “30 days” the bank meant “48 hours,” because two days later the account was as incapacitated as the 49ers’ offense.
Reader Jeff is now in a situation that we find all too familiar, but most people have never even heard of: Electronic Funds Transfer Error Hell. You see, Jeff bought a camera at Best Buy and something went wrong — causing his debit card to be charged twice. This in turn caused him to overdraft. Now he’s shocked to learn that the process for reversing the charge isn’t as simple as it would be with a credit card.
Marc’s monthly budget just exploded into a mess of overdraft fees thanks to CitiFinancial Auto’s negligence, and now he’s not sure how to get them to actually do anything to fix it.
Consumerist reader Patrick wrote in to express his dismay with Bank of America. He had purchased two items online that wouldn’t be shipping until a later date, but the authorizations placed on both items by the vendors caused him to overdraft (and be charged $35 overdraft fees) for his subsequent purchases.
Sen. Chris Dodd plans to introduce legislation that would require banks to get permission before allowing fee-generating overdrafts. Banks are on track to earn $38.5 billion in overdraft fees this year and, according to a study by the Federal Deposit Insurance Corp, most banks offer the “service” automatically. Common “features” of the programs include not notifying customers when an overdraft is about to occur, not offering them a chance to cancel the transaction, and processing the transactions in ways designed to increase the number of fees.
Corey admits that he messed up. He was the one who didn’t keep as close track of his transactions as he should have, and overdrafted his account. It was Bank of America‘s policies, however, that resulted in his being hit with fifteen overdraft fees at $35 each, for a total of $525 over the course of a weekend. Corey knew that he was in the wrong, but thought that these fees were unfair, and also more than he could afford. So what did he do? He used what he’s learned from reading Consumerist to make his case to the people in charge.
Ryan convinced Bank of America to drop their demand for $315 from nine overdraft fees by sending a well-crafted Executive Email Carpet Bomb. Ryan admitted that he was wrong to expect his checks to clear so quickly, but gently reminded the bank that nine overdraft fees was excessive, and explained that he would consider taking his business elsewhere if they thought this was an acceptable way to treat a long-time customer. Two days later, the fees were gone.
Chase bought Washington Mutual to seize market share by expanding its customer base, but its execs seem to have forgotten to take into account that there was probably a reason customers weren’t using them in the first place.
When you sign up for a checking account, most banks automatically enroll you in a “courtesy overdraft protection” program. This program means that the bank will approve overdrafts from your ATM or debit card — and charge you a $35 fee for each transaction, etc. But what if you don’t want the service? Well, the Federal Reserve has proposed a new regulation that will require banks to ask your permission before they sign you up.
Reader WW is upset because a gas station froze $100 on a debit card transaction for $12 worth of gas. This caused his rent check to bounce. Now he’s got overdraft fees and he’s wondering why gas stations are doing this.
Jenn’s checking account with Bank of America recently had a policy change designed to increase overdraft fees, and it worked: sometime between Friday night and Saturday morning she was hit with 6 NSF charges going back the previous 48 hours, because she was about 15 minutes late transferring funds into her account the day before. Technically she had broken the new policy, but Jenn hadn’t realized or remembered that there was a policy change and she was taken by surprise. She decided to try to reason with BoA’s corporate office about the fees, and explain why she thought they were unfair.
Don’t say we never printed anything nice about you, BoA. One of your customers just had an experience with you that—despite still having an overdraft fee of $20 to pay—has left her feeling pretty good about you.
Sprint. Hilary’s boyfriend wanted one phone. You signed him up for, like, a bazillon and took all of his money, plus an extra $400 from his bank account.
– About the WaMu Free Checking, yes it is a different “free” checking account. We just came out with the “WaMu” part about a couple of years ago, so if you have any “free” checking account older than that I suggest you change it to the newer one.
Dreamhost is busy cleaning up the mess after accidentally overcharging their customers by $7.5 million dollars due to a typo. The process is not going smoothly and we’ve been receiving a mix of complaints and praise.