Why allow overdrafts on debit cards? This bullshit should be outlawed NOW!

[originalpckelly]

Forgive me, but isn't it possible for a bank to decline a canceled debit card? If they can do that, why can't they do it for an overdraft, or at least inform someone that they're going to be charged a fee?

If it would cost money to implement a warning message, why not just decline the transaction? It's not a paper check, this can all be done right there and then at the point of sale.

I think I know why, banks are just trying to farm fees from their customers. So instead of just declining the transaction, they let you go ahead and do it without any notice whatsoever as to what's happening even giving the feel good "approved message" and then they charge you a fee.

I say this, as a pissed off person seeking justice. Do you think $1.25 is really just cause for a $25 overdraft fee? I intend to deposit all the necessary money to bring my account back to normal, but this is really ridiculous. Why not just decline the sale? I'd rather have that. I didn't really need the snack I bought with the card at one of those evil vending machines with card readers on them. I even had money on me, but I used the card reader because, well, it was cool. I know, very stupid, but it was cool.

So now I have to pay $25 for $1.25. It shows the absurdity of it all. They ought to charge a percentage of the overdraft, not a flat fee, even for paper checks.

Anyone else got some dishonest business practices of banks to complain about? Maybe we should try to get a law passed updating banking regulations so bullshit like this, and the stuff other people have experienced can stop.

Let me say it before anyone else does:
"Quit whining, be responsible, keep track of your funds...blah...blah...personal responsibility."

Yeah, right, what about the responsibility of a bank to inform it's customers that they're going into debt?

[Incitatus]

1. That's a simple answer

Because they won't make as much money

[backscatter712]

2. Exactly.

The capability for debit cards to be declined when you run out of money has been there for years. Some banks opt for this behavior. Most of them don't, because they'd rather scalp you with outrageous overdraft fees instead.

[originalpckelly]

4. Like I said, I paid $1.25 and end up paying $25 for it.

That's pretty fucked up.

[HowHasItComeToThis]

116. I HAVE AN IDEA.... CALL USURY, USURY

THE MONEY-LENDERS MUST UP-LEVEL THE GAME OR THEY GO BROKE

[originalpckelly]

3. It would be stupid to try and outlaw this all by itself.

is there something they've done to you that's dishonest and should be illegal? Perhaps we can get something going to stop this crap. Right now people are seriously pissed at the banks, and this bank took bailout money. Anything outlawing bad bank business practices would probably wide popular support.

[Xithras]

98. Especially true since it often doesn't cost the bank anything at all.

When I banked at BofA, for example, my checking account had overdraft protection linked to my savings account. If I overdrafted my checking, they just shifted money from savings to cover it. My own funds covered my overdraft, so BofA had no expense, and incurred no liability or risk.

They hit me with a $20 penalty anyway.

Now I use a credit union.

[Johonny]

5. I enjoyed my bank offering me overdraft protection

for my account with lots and lots of money in it. I told them I'd take the risk. Yes please offer me more meaningless fees to keep your butts above water.

[originalpckelly]

6. Aw that's nice, do you use a debit card too?

And does your bank decline the charges or charge a fee and unknowingly let you go into debt?

[DoctorMyEyes]

7. You can probably get them to waive one overdraft fee

If you call the bank and ask nicely they do have the discretion to remove the fee.

That said - yes, it's utterly ridiculous that they'd "front you" $1.25 for a $25 dollar fee. Just be glad it was only one transaction. Once my husband mixed up his card connected to HIS account with my card connected to MY account and by the time I realized what happened I had racked up SEVEN $35 fees and the real bitch of it was six of those seven transactions added together didn't even total $35!

I use the card for everything. $2 for lunch ($35 fee), $5 for a book ($35 fee) 4$ parking ($35 fee)! When I pointed out that I only would have incurred one fee if they'd let all of the small amounts charge first they told me that they let the largest amount hit the account first. Ostensibly because it "might be something important like a mortgage payment". Bullshit. It was so that they could charge more fees. I was lucky though - I went to the branch where I opened the account and talked with the very pleasant woman who opened my account originally and she was able to waive all but one of the fees.

[Raster]

80. Sounds like Wells Fargo, which is the subject of a Class Action lawsuit right now...

because of that very issue; namely, structuring debits to an account to yield the maximum penalties and fees. Instead of debiting from an account in the chronological order of the debits, they restructure the debits so the largest are deducted first.

[originalpckelly]

82. Yes, it was Wells Fargo.

[Last Stand]

103. This class action settlement (BoA) might give you the confidence to take a stand.

There was a class action suit brought against those crooks at Big, Bad Bank of America for overcharging people on debit overdraft fees. They lost and were ordered to pay $35m, but admitted no wrongdoing. They continue their wrongdoing, however, and will do so as long as no one objects. I say, “object.” Let them know that you are aware of the judgment (below) and that you will take action if the fees are not waived. These banks are out of control. The settlement was out of CA, but I think the ruling applies here, too. I don’t know if they will call your bluff, but it doesn’t cost anything to try.


http://www.clossonsettlement.com/


“The lawsuit claims Bank of America made statements in its advertising, website, and customer agreements to encourage its customers to use Bank of America debit cards and increased the number of insufficient funds fees, overdraft fees, returned check fees, and similar fees charged to customers using Bank of America debit cards through the order in which such transactions were posted and the account balance information it provided. The lawsuit also claims that Bank of America authorizes debit card transactions that will result in overdraft fees; fails to warn customers that specific debit card transactions may result in overdrawn accounts; posts debit card and other transactions in high-to-low order; and provides account balance information to customers that is not current, accurate or as advertised. In addition, the lawsuit claims that Bank of America’s customer agreements are unconscionable, and that Bank of America does not provide customers with copies of account agreements until after they open their accounts.”

[1]

8. you have my vote. its a fucking scam, the sole purpose of which is only to collect fees...

banks will not even decline a purchase that pushes you over your credit limit on a credit card. because that's another fee.

banks are fucking scum...

[FarCenter]

9. Protecting Yourself from Overdraft and Bounced Check Fees

http://www.federalreserve.gov/pubs/bounce/

The fees are set high enough to make a profit on the process of returning checks for non-sufficient funds, which is expensive.

[FarCenter]

10. Not also that writing a check against non-sufficient funds is subject to civil and criminal penalty

See http://www.ckfraud.org/penalties.html#criminal

Depending on the jurisdiction and amount, it is either a misdemeanor or a felony.

[serrano2008]

11. and while we're at it...why do I have to go to the gas station to get gas? They should come to me!!!

I mean, use up gas to drive to the gas station just to get more gas is ridiculous. The oil companies make all this money and I'm the one coming to them for more gas! They shoudl bring the gas truck around every night and fill everyone's cars up.

*sarcasm*

[Name removed]

13. Deleted message

Message removed by moderator. Click here to review the message board rules.

[serrano2008]

15. WOO HOO!!

The funny thing is that from my perspective I was the only one in the thread that WASN"T the asshole.

Seriously people, just keep track of your money. If you can't keep track of your money and you need someone to keep track of it for you, use cash.

[hfojvt]

20. that's an odd perspective

To use an analogy - suppose somebody slips on a wet floor and then cries or cries out "%&*^&$ that hurt! Why the heck wasn't there some warning that the floor was wet." That person, and other people agreeing with him/her are all a$$holes. From your perspective.

Whereas somebody who comes onto this scene and makes a sarcastic disparaging remark like "Yeah, and while we are at it why isn't there a warning sign to tell me that I am using electricity when I leave the TV on?" That person is the only non-a$$hole in the group.

That person sounds like a compassionate conservative. "Seriously people, just use some personal responsibility and pull yourself up by your own bootstraps."

Never mind that there's no logical reason for a person to be blindsided by fees on an electronic transaction. They are only hit with the fee because the bank accepted the transaction.

[serrano2008]

33. an "odd perspective" is thinking anyone who believes in personal responsibility is a conservative

In response to your "wet floor" analogy...it would actually be a closer comparison to going over your checking account, if YOU are the one who spilled the liquid on the floor and then YOU slipped on it and now you think McDonald's are to blame for not putting a warning label on their cup that if liquid from the cup is poured on a hard floor the floor may become slippery.

I've been there before, I overdraft my account probably once every 2-3 years or so and when it happens I suck it up and say "doggone-it I better keep better track of my account next time. That was stupid of me." I don't cry about how I'm a victim and try to blame my own irresponsibility on someone else.

[Bill McBlueState]

39. you have an odd definition of personal responsibility

Should "personal responsibility" mean that if you do something irresponsible with your bank account, you deserve whatever the bank throws at you?

[serrano2008]

45. Actually that's the exact definition of personal responsibility.

If you do something irresponsible with your bank account you deserve whatever penalty you agreed to when you set up the account.

How you deal with that penalty is really telling about how you live your life. A $25 overdraft fee has been one of the best financial lessons I've ever learned in my life which is don't spend money you don't have.

Now, to the poster below - I don't agree with ALL bank fees for any reason. But this specific reason of overdrawing your account a specific amount of money is so easy for people to keep track of and learn from if it happens to them that I would hardly put this in a category of banks taking advantage of their customers.

[originalpckelly]

50. I have to be responsible, but the banks get billion dollar bailouts?

I'm obviously not the only person who thinks this is outrageous and unnecessary, Barney Frank, Carolyn Maloney, and 30 co-sponsors introduced a bill in the last Congress to outlaw this, or at least let people opt-in to lending programs.

Banks are loaning money at high interest rates, in this case it was a 2000% interest rate for the $1.25 charge. Even loan sharks stick to the 100% range.

And who reads fine print? No one, they could put something in one of those fine print contracts that says they have the right to set you on fire and no one would notice it. Those are highly suspicious too. How are people supposed to consent to something they obviously don't understand and the where the text is so small they can't even read it?

There comes a point where consent can be modified by the circumstances in which it was given, for example we do not let minor children enter into legal contracts as they are not of legal age. Why should we let someone enter into a contract they clearly do not understand or can't even read?

Here's a story about these overdrafts:
http://www.alternet.org/workplace/66749/

Here's a little fact sheet on it:
http://www.responsiblelending.org/pdfs/support-hr-946-17-5b-version.pdf

[serrano2008]

70. Please don't argue with me about a different topic than I'm arguing.

Who's even talking about anything in your post?

Furthermore, your contract with the bank and the overdraft fees aren't some "hidden charges" or "fine print". They tell you right up front. I would advise you and anyone else to not sign contracts they 1) don't read, and B) don't understand. Neglecting to even take the time to read terms in a contract is hardly the fault of the bank.

And I did click on your links but overdraft fees for debit/check cards and credit cards are completely different. We're specifically talking here about overdrafting your checking account.

[originalpckelly]

72. I'm talking about debit cards, that's what I'm pissed about.

A debit card is attached to a checking account, and unlike a paper check, doesn't take days to process. Someone can know instantly whether there is enough money to cover the charge, and banks should be legally required to tell people they're running up debt at the point of sale.

[Zywiec]

75. Does your debit card have a Visa or Mastercard label?

How was your transaction processed: as a debit card transaction where you entered your PIN, or as a credit card transaction where the PIN wasn't entered?

They are treated totally different. Did you enter your PIN?

[originalpckelly]

76. I used the credit function, but I've used the same function before...

with prepaid debit cards, and they declined my purchase when there was insufficient funds. They do it, because they have no idea who you are, prepaid debit cards are anonymous. While on the other hand, the bank can track you down and make you pay.

[Zywiec]

86. When you use the "debit card" as a "credit card"

the transaction is not processed immediately. Only a hold is placed on the funds until the transaction is completed, usually a day or two later. At that time when it is run against the account, if there are no funds available, you get charged a fee.

On a debit transaction when you enter a PIN, the withdrawal is immediate and the bank won't let you go over your balance. Go to an ATM machine and try taking out more than you have. I bet it won't work.

Credit Card transaction - no balance checking
Debit Card transaction - balance checking

[southern_dem]

101. Some banks are even charging for

intra-day or pending item overdrafts. Even if you settle the overdraft before the daily deadline, they chaged the OD fee anyway.

[Atman]

117. I'm sorry, you are wrong.

It is a very common practice these days for banks to grant what they call a "convenience loan" to customers overdrawing their accounts via a debit card. They claim it helps the customer avoid the embarrassment and inconvenience of being rejected while in a checkout line, etc. Of course it is a money churning thing, nothing more, but they want you to believe it is all about "customer service."

I do agree, though, that using your debit card as a credit card is generally a good idea.

.

[philk17088]

84. Not true

THe card reader could determine that you had x amount in the account but it can't know that you wrote a paper check a week before that got posted to your account after it processed your $1.25 transaction.

[originalpckelly]

85. Banks keep track of how much money you have on their computers.

I never write paper checks in an effort to avoid any overdrafts. (Guess that doesn't work too well, now does it.)

I have seen credit's seedy side and truly dislike it, and so I stick to debit cards. In the past I have used pre-paid debit cards that are declined for insufficient funds. I'm going back to them.

[originalpckelly]

42. With normal paper checks it is completely understandable.

They should probably not charge a flat fee, but a percentage of the check, that's my gripe on that. Now, I've never done that, I always use a debit card.

What you don't get is that there can be a change in funds in a single day that people aren't aware of immediately, they charged me some fees for being under $100. They don't inform you when the fees are coming out of the account.

And if you read elsewhere in this thread, you can see that some banks are intentionally stacking up charges to maximize overdraft fees.

[Imperialism Inc.]

120. I'll pass on the caveat emptor society you envision.

I recognize the benefits of a market based economy but it is for a reason. Competition and, yes, even greedy behavior can sometime spur innovation and end up creating good for society. However, banks feeding on the vulnerable like vultures doesn't produce any greater good and so I am opposed to it.

[propagandagirl]

12. US Bank does the same thing.

Happened to me once, a few years ago. When I called to ask why the purchase wasn't declined I was told the bank allows overdrafts, up to a point, as a way to help customers who may be in need of extra cash for, say, an emergency!! They then turned around and charged me a 30 dollar overdraft fee...

I did read somewhere that Bank of America is being sued for this practice.

[zane25]

14. We use a payroll card

For some reason they seem perfectly able to keep instant track of every transaction every single day without fail. Never a single delay or disapearing transaction. There is no such thing as an overdraft fee, so you can imagine if a miscalculation takes place the card is declined. We have paid no more than the $3 monthly fee in over 2 years and have neve had the "stacking charges together" starting with the largest first. A famous tactic of BOA.

[leftstreet]

16. Why do you hate bank CEOs? They have to eat too!

:cry:

Why, just look at this poor guy:

Lloyd Blankfein, chairman and chief executive officer of Goldman Sachs



Blankfein earned a total of $53.4 million in 2006, making him one of the highest paid executives on Wall Street. His bonus reflected the performance of Goldman Sachs, which reported record net earnings of $9.5 billion. The compensation included a cash bonus of $27.3 million, with the rest paid in stock and options. Blankfein earned a total of US$67.9 million in 2007, he will receive US$26.8 million in cash, and US$41.1 million in restricted stock and options.
http://en.wikipedia.org/wiki/Lloyd_Blankfein

:cry:

[Cid_B]

17. My bank...

... has the option. You can sign up for overdraft protection or have it declined.

[Earth_First]

18. Two words: Credit Union. n/t

[WePurrsevere]

48. Credit Unions are doing this in increasing numbers now too...

for checks and debit card transactions.

I've only done business with credit unions for almost 30 years now. We currently do business with two CUs and they both offer this "courtesy pay" service now (one just started a couple of weeks ago).

Since we're both on Soc Sec Disability and only get money in the beginning of the month and live on the edge financially, we've actually found this service to be helpful and well worth the $20. charge a time or two. When we've had to use it we paid it back at the beginning of the month which is within the 30 days the CUs require. There's no interest at least this way and only the one time fee per transaction.

If folks don't want the service they can probably opt out. They can also pretend it doesn't exist and if they're financially able to do so make sure they always have a decent cushion in the account so it's never that close to be an issue. OTOH for those who do want it and use it intelligently.. it can be a blessing. :)

[depakid]

19. Alternet had a piece on this scam a while back

Young Adults Are Getting Hit with Enormous Overdraft Fees

The consumer finance industry-including banks, credit unions and credit card companies-is never short of ways to lure in the American consumer, and a recent analysis performed by my organization, the Center for Responsible Lending, illustrates precisely how banks and credit unions are socking it to young adults -- to the tune of nearly $1 billion a year.

More and more consumers -- particularly young adults -- are finding the deck stacked against them when it comes to battling abusive overdraft fees. Banks and credit unions now routinely allow most debit card transactions to go through when their account holders have a negative balance. Instead of declining the transaction, institutions will advance the funds to cover the shortfall (often less than $20) and charge the account holder an average fee of $34 for each overdraft.

Consumers are not given an adequate chance to prevent these fees, which are largely out of proportion to the loans themselves. In fact, adults in general pay about $2 for every dollar the bank advances to cover debit card overdrafts, while young adults pay $3.25 for every dollar loaned to them, due in large part to their frequent use of debit cards for low dollar transactions.

...There is a solution, however, and it's pending before the U.S. House Financial Services Committee. HR 946, the Consumer Overdraft Protection Fair Practices Act, sponsored by Carolyn Maloney (D-NY) would require banks and credit unions to disclose the interest rates of these abusive overdraft loans so that consumers can compare the cost of this credit option to others. It would also empower account holders by allowing them to the choice to opt-in to an overdraft program, rather than automatically enrolling them without their express consent. It would also prohibit banks from manipulating the order they process checks and debits in order to increase fees.

The legislation is sorely needed for the sake of consumer protection. Even our most vulnerable and inexperienced consumer group-new, young bank customers-is not being shielded from abusive practices. Instead of protecting their financial wellbeing, these overdraft loans are robbing young people of a secure and solid start in their lives.

In the meantime, all consumers, but especially younger ones, should be wary of overdraft protection programs - especially those in which they were automatically enrolled or those that are not linked to a line of credit or to a savings account. Unfortunately, overdraft "protection" programs rarely consider the consumer's best interests and typically protect nothing more than the bank's bottom line.

http://www.alternet.org/workplace/66749/

[originalpckelly]

47. The bill just was referred to committee and killed.

That's a bunch of bullshit.

[Ferretherder]

21. Our friendly local currency-vampires - sorry - bank,...

...(Chase, by name)will thoughtfully wait until the very last minute, hoarding all of our payments on things like the car loan, car insurance, utility bills, etc., and run them ALL through at one time in hopes of crashing the account and collecting on the overdraft fees. They even go so far as to run the largest payments through first, then keep adding the next highest, the next highest, and so forth, in hopes of scoring SEVERAL fees on the lowest remaining payments.

But hey, they're just tryin' ta make a livin', dontchaknow!

Fuckers.

[conscious evolution]

27. That is totally illegal

to do that.
It was at one time anyway.
I remember back in the early ninties several banks were busted and had to pay big fines for doing that.

[originalpckelly]

34. Well, the Alternet article specifically says the law in Congress was to also...

outlaw transaction manipulation.

[SOS]

87. Law was changed in 2005

Bank lobbyists got the law changed.

[originalpckelly]

89. Of course they did...

and the law fixing the problem died, even in a Democratic Congress.

[SOS]

90. It's a disgrace

One Thursday I deposited a check from the State of New York for $500.
That weekend I used my debit card 7 times for about $125 total.
They slammed me with $245 in fees!
I freaked out and fought with them (in the bank) for half an hour.
Got it reduced to $105.

They said the NY State check was "uncollected".
It's sickening.

Once bitten, twice shy.
The bastards haven't gotten a penny in fees from me since.

Edit: One more thing...
In my screaming match in the bank, I said that it was great that the bank would honor my debit card, even if the funds were uncollected.
I then informed the witch that I would purchase a Rolls Royce with my debit card later that afternoon.
She said the "protection" was limited to $500.
Or in other words, just enough to rip off your next paycheck!

[originalpckelly]

102. That's what you call a protection racket.

[CANDO]

22. Someone beat me to it.....

Credit Union! You won't get fee'd to death.

[wuvuj]

23. The consumer and the taxpayer are like aphids to the ants?

An endless source of nectar?



Constantly nickeled and dimed or much worse? Now that the people have some SLIGHT control again...this kind of thing needs to be regulated?

As Carl Sagan would sat...BILLIONS and BILLIONS to the banks...and still the endless fees?

[ejpoeta]

24. i know my husband's credit union doesn't allow you to go over what you

have in your account. my m and t does, and they have. and they do it because the fees are SOO outrageous! $39 per incident.

[aikoaiko]

25. You can decline overdraft protection. It comes with many cards, but you can decline it.

Yes, fees are an incentive, but it is your responisility.

[originalpckelly]

35. Overdraft protection? Misnomer much? That's dishonest labelling.

It doesn't protect you from overdrafts, it allows overdrafts!

[aikoaiko]

46. Overdraft protection protects you from not being able to pay your bill.

I feel your pain though. I used to bank at Bank of America. My wife didn't understand the overdraft terms and purchased a couple of small items all under $10 and got hit with 25 and 30 dollar fees EACH. I tried to talk to BoA and they are unconcerned and unresponsive.

So now we do all our banking at Wachovia where if you go over any amount it rounds up to the nearest $100 for a $10 fee plus APR. Those terms are much more reasonable.

[Gormy Cuss]

51. It is Orwellian newspeak.

What "courtesy overdraft protection" does is protect you from a bounce fee from the merchant. For that courtesy your bank charges you a stiff overdraft fee.

It used to be that overdraft protection meant one of two things: a linked savings account where funds could be accessed when there were insufficient funds in the checking account, or and overdraft line of credit, where the amount in excess of the check was treated like a credit charge with interest accruing immediately. In your example, $1.25 overdraft would probably have cost you a few cents and perhaps a couple bucks of transaction fees.

The "courtesy overdraft" is a much more lucrative way for banks to handle it.

[Belial]

26. Try to switch banks.. thats about all you can do..

I found a credit union I was able to join.. it was just little ol me.. but the best thing I could do was walk.

[proud2BlibKansan]

28. Here's a worse one

My son closed an account a few years ago. Took every penny out and closed it. Then about a year ago he started getting letters from a collection agency. He had overdraft fees at this bank. By the time the collection agency contacted him, he supposedly owed the bank nearly a thousand dollars.

He finally called the bank and asked wtf this was about since he had closed the account and had not used it at all. Turns out he had not paid the monthly fee and had closed his account at the end of a cycle and owed a full month's fee. That had grown, with interest, and by the time the collection agency added their fee, he owed them an outrageous amount.

He pointed out that he had gone in person to the bank to close the account and shouldn't the teller have told him about the fee and deducted it from the money he had left in his account. That is the only reason they cancelled the debt.

And for all you credit union fans, this WAS a credit union. It was a nice small neighborhood credit union and was bought out by a larger national one. That's when they nailed him for this service fee.

[Phoebe Loosinhouse]

29. delete - wrong place

[ima_sinnic]

30. sounds crass to say, but maybe you need to keep better track of yr spending

I check my balance DAILY online and keep scrupulous track of outstanding checks, just to avoid going over my balance. I use my debit card for just about everything in place of cash, but if I know the balance is getting low, I figure to the penny just what I can spend. And don't forget to include outstanding checks when figuring what you have available.
Also, mine is a credit union debit card and it does decline transactions that are over my balance. I just don't want the embarrassment of a declined card with a big load of groceries waiting to be paid for.

[Phoebe Loosinhouse]

31. Did you know you were that low on funds and used the card anyway

even with cash in your pocket? If so, it's hard to be overly sympathetic although I agree that the fee for overdraft is outrageous - they always are and that's why banks LOVE overdrafts.

BUT, I know of cases where people are completely blindsided by being overdrafted when they are sure they money in the account;it often happens when they use the debit at a gas station and the gas station puts a "hold" on the funds that is much higher than the amount actually used at the pump. This happened to a co-woker of mine a couple of years ago. She was tightly budgeted, had about $40 in her account, used $10 for gas, and $15 for groceries later that day. The gas station had put a "hold" of $50 on her account! causing her 2 later legitimate purchases to trigger overdrafts. The money was not taken off of "hold" for several days!!!

Now, that is an outrage. I think it happened to lots of people and only when they used a debit card. Strange that nothing like that happens when someone uses a credit card.

[originalpckelly]

36. I thought I had enough actually.

And my example is just mine, I know it's happening to other people now and that it's a real abuse.

[OPERATIONMINDCRIME]

32. Easiest Way To Avoid The Fees Is To Not Spend More Than You Have To Begin With.

Taking responsibility for current account balances and expenditures is the easiest solution.

[originalpckelly]

38. Ah, yes, and the responsibility of the bank to decline a transaction...

or inform you that you're going into debt, well that's not anything to worry about.

Lots of things can happen in a day, it just so happens that they charged me a couple of other fees the same day without me realizing it, and that's why I had less money than thought.

[originalpckelly]

44. Oh yeah, um, this bank took bailout money, why shouldn't we charge it an overdraft fee?

[SOS]

91. Just don't trust the online version of your account

The latest deposit will be indicated as credit, but you must also now the status of the deposit clearance.
So remember to wait a week before spending on a debit card.

[OPERATIONMINDCRIME]

92. Not Sure What Bank You Use, But BofA Online Shows Pending And Available Balance.

If it's available, it's available.

[ellie]

37. The banks,

especially Charter One, let you go over on your debit card and then charge you outrageous fees. And if your debit card number is stolen, they will allow the thief to charge up hundreds of dollars that you don't have for the fees (I don't know what they were thinking; maybe that I was going to pay for the thief's $800 purchase from a Wal-Mart two states away? NOT). And when you go in to the bank to file a report, they will say that they have flagged the card and canceled it, until it happens the next time and the cycle starts all over. And then when you tell them you want to close your account they look at you with these sad, puppy dog eyes and ask "WHY?" For fuck's sake.

There are a lot of defenders of the banking industry on DU. I don't understand it. Banks are the most corrupt institutions on the planet, really giving Wall Street firms a run for their corrupt money.

[originalpckelly]

40. I had to deal with this once before, but it was due to fraudulent charges on my card...

They drained my checking and my savings account, because the two were linked together, and get this, I was charged for that (a fee to transfer funds from the saving account to the checking)! So then, eventually the crooks ran up debt on my card. Now fortunately, they credited my account back with my money, but why should that have even happened? It's bad enough my accounts were drained, but then to have them run up debt was pretty surprising.

[ellie]

61. Exactly

That was my question to the manager: Why would they let someone charge more than they had in the account? She didn't answer me but we all know what the answer is: To charge outrageous fees! I guess losing money from time to time because of fraud is an accepted business practice when you can charge fees to people who thought they had more in their accounts than they thought through honest mistakes.

Fucking disgusting. But I guess it is the consumer's fault, isn't it? :sarcasm:

[originalpckelly]

64. And of course, I have to be responsible...

but they get billions of dollars to bail them out, and this by the way was a bank that did get it. It's Wells Fargo, and it's not just this. They have extremely high pressure sales tactics when you sign up with them. The only reason I did it was that they're the only bank that has a AAA credit rating and they're right next to where I live. Convenience be damned, I'm going back to prepaid debit cards. I never had this problem with them. You can get your check completely deposited on them, and you only get charged a buck or two for taking the money out at an ATM.

[Bill McBlueState]

41. The "personal responsibility" cult gets tiresome

Sure, people should be responsible with their money and do their best to avoid overdrafts. That's personal responsibility.

But "personal responsibility" doesn't mean that the bank is justified in doing whatever the hell they feel like doing in the event you make a small mistake.

[originalpckelly]

43. Exactly, people aren't perfect...

and misleading "approved" messages at the point of sale don't help. I could see charging overdraft fees for things like paper checks, as I said in my original post, but not for debit cards. I also am pretty good at keeping track of things, but they charged me some fees that I didn't know about.

[dysfunctional press]

49. wow....unbelievable.

"what about the responsibility of a bank to inform it's customers that they're going into debt?"

um...how is that the bank's responsibility? whatever the terms of the account are- you agreed to them when you opened it- did you read everything that you signed? if the terms were not agreeable to you- why didn't you take your banking business elsewhere?

but then- whining is SO much easier than personal responsibility, huh? :shrug:

[originalpckelly]

53. I'm not the only one who thinks this practice is outrageous:

http://www.responsiblelending.org/pdfs/support-hr-946-17-5b-version.pdf
http://www.alternet.org/workplace/66749/

Banks can make mistakes, but they get billion dollar bailouts.
When we make mistakes (and a $1.25 isn't that big of a mistake) we have to pay 2000% interest on it.

Yeah, sounds about right.

[dysfunctional press]

56. what's REALLY outrageous-

is people who agree in writing to terms and conditions, and then cry 'foul' when they fuck up.

a lot of people in this country have a LOT of growing up to do.

[originalpckelly]

57. Like the people who run the banks, they have a few billion dollars worth of growing up to do.

Fucking up a financial system = billion dollar bailout
Overdrawing one's account for $1.25 = 2000% interest charge.

[dysfunctional press]

58. waaahhh... waaahhhh... waaaahhhh...

:eyes:

[originalpckelly]

So Barney Frank was enabling whiners when he and Carolyn Maloney...

introduced a law to outlaw this or allow people to know it's happening?
http://www.alternet.org/workplace/66749/

People should be informed at the point of sale this is going to happen and have the choice to decline the charge.

[dysfunctional press]

62. people should know how much money they have in their accounts...

but- it's SO much easier to just:

waaaahhhh....waaaaahhh....waaahhhhhh

[originalpckelly]

66. I'm not asking for free money, in fact I would just have rather had it say...

"DECLINED"

That would have been perfectly fine with me, I try to live a debt free life, Mr. Responsibility. God forbid someone should make a mistake every once and a while and expect not to get completely screwed by it.

[dysfunctional press]

68. why didn't you decline overdraft protection when you opened the account?

:shrug:

that would have solved your problem and given you the 'declined' you wanted.

[originalpckelly]

69. Um, didn't know what the fuck it was? Overdraft protection sounds like protection from overdrafts?

Why call something overdraft protection, when in all actuality, it enables overdrafts

I'm just guessing about that, too, I don't even remember now if I was asked about that. They should be mandated by law to clearly state what it is, that's a highly misleading term.

[dysfunctional press]

71. why didn't you ask the banker to clarify it when you read the document before you signed it?

:shrug:

[originalpckelly]

77. Don't know now.

Probably was just excited to open an account with a big check.

[BlooInBloo]

54. Americans simply don't believe they're responsible for things they sign.

[originalpckelly]

67. How can someone possibly read all the fine print?

And if they could, how can they actually understand it when it's written in legal mumbo jumbo?

Why not just have clearly phrased larger print type that explains the terms and conditions of an account, rather than placing hidden gotcha BS in fine print?

Someone can present you a contract that allows them to kill you and you sign it, but it doesn't make it right. This shit is crazy.

[dysfunctional press]

73. one simple rule- don't sign anything you can't read or understand.

that's a life lesson that's worth much more than $25.
you got a bargain. :hi:

[originalpckelly]

79. True, but there are tons of things with hidden print.

I wouldn't be using DU right now if I had to live my life like that, the contract that came with the DSL service had tons of fine print, and I actually can't read it as I have bad eyesight!

[hugo_from_TN]

94. Absolutely!!

I don't know how many stories I've heard recently about people not reading their loan agreements because they are long and full of legal talk. Read it! If you don't understand something - ask someone who does. Ask the lender to explain everything you don't understand. Ask your brother or good friend who understands this stuff better than you. If it's something major like a mortgage, pay a lawyer to explain it to you. Always read and understand before you sign any contract!!!

[BlooInBloo]

81. (facepalm)

How, indeed.

[originalpckelly]

83. Maybe there should be a law against fine print like that?

Now that would be worthwhile.

Legal Agreement Clarity Act of 2009.

[ellie]

63. How about the bank

declines the transaction at the Point of Sale?

[dysfunctional press]

65. if the person declines overdraft protection when they open the account, i'm sure the bank would.

people need to be responsible for their own actions AND inactions.

[ellie]

88. Overdraft protection

is a line of credit and is given to people with good credit. Not everyone gets them. If a person doesn't have enough in their account for the transaction then the bank should decline it. I am not sure what the problem is here? The only reason a bank would allow a transaction to go through if the person doesn't have enough money is because they want the fees.

[propagandagirl]

111. You are right!

When this happened to me a few years ago, I did NOT have overdraft protection on my account. My bank automatically pays a certain amount of overdrafts, before returning items unpaid. They then charge a 30 dollar fee for each overdraft. Same with the debit card. They will allow a certain amount of purchases to go through before declining them and then start adding on the fees for each transaction THEY approved. It's total bullshit.

[Scout]

114. don't waste your breath on that one ... not worth it

you can make all the sense in the world and it will do no good.

[SOS]

95. No

I asked the bank to decline the sale if funds were deposited, but uncollected.
They refused.

[dysfunctional press]

113. was declining oveerdraft protection an option when you opened the account?

and if you're asking them to use it in some cases and not others, i can see why they might decline to do so. :shrug:

[SOS]

122. No

The account was opened in 1994.
This is not "overdraft protection" in the sense of a loan at interest to cover a check.
This is allowing a debit purchase to go through, not in the form of a loan, but as a "service" for a fee.
Two different things.
My bank doesn't even offer overdraft protection. It was never an issue.
After being shafted out of $105, I requested that any debit that is drawn against an uncollected check be declined at the point of sale.
They refused.
Now I make sure all checks have cleared.

Allowing debits to go through against insufficient or uncollected funds (at a $35 per transaction fee) wasn't even legal when I opened the account.

[SOS]

93. The bank should decline the sale. Period.

As it was prior to 2005, before the parasites bribed Congress to change the law.
Is it our "responsibility" to read tens of thousands of pages of banking legislation too?

Where was the sign in the bank in 2005 informing us of the law change?
Wasn't it their responsibility to inform us?
If this "protection" is such a kindly "service" from the vampires, why do they hide it in 15 pages of micro-printed legalese?
Surely you read those inserts, with a magnifying glass, every month on every card and every account.
Anything less would be irresponsible.

[SOS]

104. Serious question

When you receive a document like the one pictured below enclosed with your bank or credit card statement (often 6 or 8 pages long) do you really read every word, every month on every account?

[pipi_k]

52. Pros and cons of overdraft protection...

A Pro: you pay an important bill but there's not enough money in your account to cover the payment, so instead of your important account going into delinquency (fucking up your credit rating), it goes through and you end up getting charged a fee that you might figure is worth the $25 or whatever to keep from getting a black mark on your credit rating.


A Con: Just what you wrote about. Being charged a huge amount of money for going over while making a purchase of less than 5 dollars.



Sometimes it's the fault of the account holder, sometimes not. Example...last year Mr Pip got an overdraft letter from the bank on an account he KNEW had enough money in it. Turns out that one of the places where we have a car loan (and automatic payments) took money out they shouldn't have in an amount more than our monthly payment and applied it to someone else's car loan. Without overdraft protection (I'm not talking about the fees) it would have been a HUGE mess.

When it is the fault of the account holder, it's time to get a whole new strategy. In my case, since I don't balance my checkbook anyway (seeing as it's all debit and online now), whenever I make a deposit or transfer to my checking account, I always mark down that I've put in less than I really do. Say I put in $325.00. I mark down in my records that I've only put in $300.00. So there's an extra $25 floating around in there that I just ignore. I do this each month and pretty soon I've got a pretty good "cushion" against overdrafts. It works for me, but like I said, you have to totally ignore what the online account says. I go by what I write in my checkbook...yes, I do still record debits in my checkbook.

When my written checkbook balance falls low, I just transfer from savings, again, more than I actually record. It doesn't even have to be $25 a week or whatever...just a few dollars extra a week can be the difference between peace of mind and getting socked with an outrageous fee for being two dollars short on a purchase.

[originalpckelly]

55. I'm going to settle the balance, and close the account.

I've had my share of the BS, I really don't need the account, and I can get by with paypal and prepaid debit cards, which don't charge you overdraft fees, which is why I used them! :P

[pipi_k]

59. Ya do what ya gotta do

even in the best of times. These days, it's even more important to protect yourself from vultures.

I think that at the end of all this, there's going to be some very major changes in the operation and structure of financial institutions because people aren't going to tolerate being personally screwed over very long.

Viva la revolution!

:woohoo:

[originalpckelly]

60. No, we need a rotation. Revolutions take a year, rotations take a 24 hours.

:P

[treestar]

74. Oh, yeah, the perfect brigade that never makes a mistake

It only takes forgetting one item and this can happen.

My bank did that to me $33 per payment and there were several of them - I didn't realize what I'd forgotten until I got the statement. It was one mistake that cost me $120 or so. Then I bought overdraft protection.

I'd rather they just decline the card. But I think the point was to sell me the overdraft protection.

[SOS]

96. And the perfect brigade (aka Wall Street apologists)

never question the intent of the law.
The law was changed in 2005.
Instead of decliining the sale, they now approve it and take a $35 fee.

A question for the apologists: Was the intent of the law to provide a valuable new service to the customer or to rake in billions in new fees for themselves?

[treestar]

107. They had to know that the way it happened to me was going

to be the way they sold it to most people. When you open the checking account I wonder if they don't make a big pitch then, either.

[philk17088]

78. Read your agreement.

You and no one else is to blame for this. The bank didn't blindside you at all. YOU agreed to it!

[SOS]

100. He could not have agreed to this, if the account was opened before 2005

It was illegal to approve a debit and then charge a fee prior to 2005.
If the account predates 2005, it would be impossible to agree to something that was illegal.

The law was changed and the banks added one of those micro-printed legal documents with a statement sometime in 2005.
Surely you read those with a magnifying glass every month on all accounts?

The only option then is to disagree with the new terms and close the account.
Which is what many are doing now.

And that's good news.
Disagree and close the account!

(Just did that with a Citi Visa card and saved a bundle!)

[Codeine]

97. Balance your damned checkbook.

Simple arithmetic.

Also, try calling your bank and asking them if they can waive the fee. Oftentimes they will if this is not a regular occurrence.

[SmileyRose]

105. for this OP it wasn't that simple.

Yours was my first reaction too, however, in reading the entire thread it looks like the OP was cutting it close, thought they had enough. The bank hit the account with fees on an unexpected and unplanned for day.

There are an awful lot of people in today's economy cutting it very very close with account balances. Banks are legally allowed to change the amount of fees and what day they hit your account any fat time they choose to. They are supposed to give you a notice. However, there are many many ways a customer might never receive that notice through no fault of their own.

I have to agree with the OP. Banks SHOULD have an option to allow customers to have NSF electronic transactions declined. There is no charge to a customer if their credit card is declined, there's no reason why debit cards can't enjoy the same service. In addition, all but the smallest of businesses now electronically scan paper checks. Declining these checks as NSF and bouncing it back to the merchant costs the bank nearly nothing - because the merchants are paying for the scanning system. Most merchants are also charged a fee for deposit chargebacks, which is equally ridiculous.

Banks are trolling for fees. Nothing more, nothing less.

[Raster]

106. "Banks are trolling for fees. Nothing more, nothing less."

That sums it up perfectly.

And now a word to the "hand-on-the-hips-and-wag-that-finger-crowd": How many of you cheat on your taxes, your spouses, your drug tests, your college exams, etc? Do you take personal responsibility for all your actions at all times, without fail, to the point of honestly being able to lecture someone else? Are you really the one to be casting the first stone? Please, step on up.

We Can Do Better--for EVERYONE!:kick:

[originalpckelly]

108. I just deposited the money...

but this is not the end of this, I'm actually going to do something about it. I know that this could cause someone else lots of harm, and it is fundamentally unjust to allow someone to run up debt without knowing it. A credit card is a known instrument of credit, the idea behind a bank card is that it isn't!

If I wanted a high interest rate credit card, I would have applied for one, not a bank card! They wronged the wrong guy. To use the now old cliche, I don't get mad, I get fucking even.

[Hugabear]

99. Your overdraft charge is only $25? Consider yourself lucky.

Mine is $35. And don't hesitate to charge it. Even if they know I have money in my savings account, instead of transferring over enough to cover the charge, they'd rather hit you with the overdraft charge.

[bosbdd2009]

109. Right on

They did the same thing to my elderly 85 year old half senile Father, he went $5.00 over his bank account balance using a mastercard debit card, and they charged him the $5.00 plus a $32.00 overdraft fee.

It's ridiculous and needs to be changed.

[originalpckelly]

110. Welcome to DU!

It is really outrageous, I just paid it all off, but I shouldn't have had too even worry about it. Even if they were to still charge a fee, it should be a percentage of the amount.

[Mike 03]

112. Yeah, we need our banks to remind us to live within our means. Absolutely.

What would we do if we had to actually be responsible for our spending?

[Hello_Kitty]

121. Banks that just got bailed out to the tune of billions for their profligacy

Aren't in a position to tell anyone shit. Still, it's pretty assholish of them to ding people for being overdrawn by $1 when their executives are whining that $500k a year isn't enough to live on.

[SOS]

123. Sorta funny to think

that a bank with $40 in debt to every dollar in capital on hand would be in a position to tell us anything about "responsibility".

[thereismore]

115. I charged two $.99 items on debit on the internets, bank charged me twice $35 in fees.

That's because by the time the two purchases posted, the same bank did an automatic withdrawal of more money than was my balance and put me in the negative territory. When the two $.99 charges hit, they were in the red. This is the biggest bank in existence right now, and they shit on a customer of 10 years.

[originalpckelly]

118. They need to pay.

Both literally and figuratively. We must end this bullshit.

[kster]

119. I don't really want to jump in to this debate, but

"LOL"

I don't have any credit cards, I do have a debit card, the reason, INTERNET purchases, sons Xbox fee and the such. If my debit card charged me an overdraft fee I would take the debit card cut it up, and take it back to the bank and tell them to go f*ck themselves with it.

But thats just me,

for the people that have credit cards and go to make a purchase and their credit card comes back DENIED

one more time

for the people that have credit cards and go to make a purchase and their credit card comes back DENIED

I'd want to know

Why didn't my debit card company use the same system to deny a company or person that tried to take money from my account, that obviously wasn't in my account, as the system used to deny someone the credit to make a purchase with his/her credit card?

Just thinking out loud. Don't want to get into a fight..


:)