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H.R. 946, The Consumer Overdraft Protection Fair Practices Act
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Visitor Comments
Eilene Federico
H.R. 3449 was a similar bill introduced by Rep. Carolyn Maloney in 2005. The 109th Congress sat on this bill, and I applaud Rep. Maloney for introducing H.R. 946. I just hope that this time it becomes law. The last thing our working class families need is to be kicked when they are down. Predatory banking tactics need to be stopped, and I would like to see our California legislators support this bill. I would hate to see this bill sit around for another 2 years.
Deborah Wittig
BB&T did this to me. I was short 9.05 in the bank. They paid the bills from largest to smallest which resulted in a 700.00 overdraft fee. When I called and explained to them how stupid that was, I was told that it was up to the bank to do what they wanted. I opened an account in another bank and closed the bb&t one out. They say I owe them $900 but I am fighting them and refuse to pay. No one gave them the right to do that.
stephen mintz
Fair is fair. When I 'float' a check, I expect to be charged, but this bill isn't about that...it's about the manipulation banks accomplish to earn the most in overdraft charges from you.
Thanks to Eilene for alerting people to this bill. I hope everyone takes just a second to contact their congresspeople.
Tracey Tarrant
I've had this happen to me numerous times and it's a domino affect. When I screwed up and overdrafted one week, I had to float checks to survive until the next paycheck. I understand being charged a penalty for overdrafting an account, but 35 a transaction is insane. There should be a time limit to allow us to cover the overdraft before fees are charged.
Another thing is the time it takes to notify us of an overdraft. If it weren't for the fact I check my account every day online, there are times I would never have known I was overdrawn. It takes up to 14 days to receive an overdraft notice.
Kelly Clark
I've had this happen to me too. In one year I estimate that I paid nearly $1,000.00 in overdraft fees, specifically for this reason. In fact, if I make a deposit in my bank on saturday and then use my atm card on Sunday, many times I they have posted the purchases before the deposit and then charged me overdraft fees. Not to mention the way that they post things from largest to smallest. I truly believe that banks are making a killing on those fees.
Martin R.
This bill is a no-brainer. I was just charged 10 overdraft fees for 5 overdrafts, all paid with a debit card, which does not block your payment if you're overdrawn. The number of fees were doubled because of a manipulation of what the bank calls a "hold." The amount of the largest charge was deducted as a "hold" first, enabling the bank to count smaller charges, which would otherwise have been covered, as overdrafts. Insult to injury: Even though money had been "held" to pay the larger charge, that payment actually was not made until a day later, when fees had turned the account negative, and so it too was slapped with an overdraft fee. Nothing was actually "held"; the bank played a shell game. Total corruption.
L. Rowe
I hope this bill survives and is passed. I just last week made a mistake -- I thought my online pharmacy was going to charge me once, but they charged me twice -- and I accrued 10 overdraft fees at USBank, $32 each. The debit I wasn't expecting from the pharmacy, as well as four subsequent debit card charges, were subtracted from my ledger balance while they were "pending," even though that wasn't reflected in my ATM balance or my Internet balance statement. I was charged overdraft fees once when the charges were "pending" and again when they were paid! I'm broke til the next paycheck.
B. Embrey
I have been taken by BB&T also. i hope this bill passes. Last year I was on vacation then got home to find out i was about -250.00 I thought it was an error on by behalf. so i overlooked it. then my son opened acct with BBT then he had had a similar situation and I just thought he was young and made a mistake. Now my husaband and I have and acct and now it is almost 500.00 in overdraft fees and when i go to the bank they tell me some crazy story that they do not do the transaction as they come in they do a large group together and if they go over you balance then they charge you for each and every transactions. that is crazy they should not be allowed to process how and when they want. because if you look at the statement there should be no fees.i think this is crazy how they can do banking this way.
Rachel Haskins
Yep-this happened to me today. I got a whopping $288 in overdraft fees. I bank with Suntrust (who I would never recommend to anyone).
They are SUPPOSED to put in a deposit before debits and they did it the opposite way. I'm beyond pissed. I'm closing my account today.
Kurt Kruger
Here's a good one for ya. I have an account with chase, and I deposited money (cold hard cash, not a check) to my account. Well they decided to hold it for an extra day(you know, becasue you have to wait for cash to clear?). In the meantime my account overdrafted. After all was said and done they zinged me $500 bucks for it. When in reality there was no actual overdraft. They created one. To put the icing on the cake, some how or another they pulled the money out of my business account to cover the overdraft and subsequently overdraft my business account. WHAT A SCAM! IT HAS TO STOP NOW!
Karney Hatch
Try small claims court. It worked for me against Wells Fargo (on Ralph Nader's advice). Check out my film (due this summer):
http://www.overdrawnmovie.net
Elizabeth Manresa
If you live in the DC area and would like to tell your story in a news report-- please contact me.
elizabeth.manresa@turner.com
Julia
It is an individual's responsibility to track their finances. While the purpose of bank is to provide customer service, this service is and should not be free of charge. A bank is a business just like any other good or service we use and must have revenue to stay in business. Although OD fees can be costly, it is up to the individual to track their own personal finances. It is not the bank's responisbility to do so. In addition, most people who overdraw their accounts (with exceptions, such as those on this blog) do it knowingly. This bill requires an ATM to let a person know how much their OD fee will be, but do you really think this will stop a person from taking the money if they need it? Probably not. This bill will create a plethera problems within the banking industry. It is time for people to take responsiblity for their own actions.
July
Julia is right on. These blogs above leave one part of the story untold, that's the bank's side. Before you condemn the bank's for charging fees on overdrafts, try balancing your check book first and read the multitude of information the bank provides to you in the disclosures. Bank's are the most heavily regulated industry on the planet. The real truth is that these guys know that there is little value added in most of the laws and that the banks will pass on the costs to us in the end. Great slight of hand, uh!
S.Keeton
I can relate to all of the stories above, it's all happened to me one time or another. I have been wanting to add from year to date on how much I have paid due to overdraft fees, serouisly I know all it would do is make me depressed and peed off. Realistically I know it has to be close to $5000, that's were that lets pay the biggest to the littlest or now all of my transactions don't appear online go figure. I've been banking at Lasalle for 3 years and have always kept up with my account online. I could use my debit card at the gas station and be home not even 5 minutes later and it would show up instantly online. Why do you think Lasalle doesn't do that anymore, white collared crime at it's finest. I hope they pass this bill and make all banks reimburse all customers for bounced fees they have accumulated for the past year, that would be a great Christmas for my three kids.
Nick
The point is that the system is stacked and purposely ripping people off. Yes, we need to manager are accounts and finances and a lot us sometimes think maybe we may get one overdraft charge. Not an excessive eight. I just bought a house 2 months ago and I bank with Wells Fargo. I had some things I need to pay for. I have received about 1300 dollars in overdraft charges because of this system when only out of the whole ordeal 5 or 6 charges caused the downfall. Not 38 items! This morning I went to a small town credit union where I live and they will not give me an account now because my credit was wrecked so badly in the last 2 months. The reason, no payments on Wells Fargo credit card in the last 2 months. Maybe they should take the over draft charges and pay the whole card off. I would like to thank Wells Fargo for damaging credit and making my home buying experience so pleasant.
S.Keeton
So does anyone know if and when this bill may go into affect?
m^2
I will admit that, yes, it is the responsibility of the individual to manage their own finances. But that doesn't give big banks the right to "wring blood from a stone", as it were. US Bank charged me overdraft charges on three Debit Card transactions, and yet - even after the ODC's - my balance was still in the positive. Then a fourth ODC which finally brought my balance into the negative. All in one day. And they did it again a week later - ODC's on a positive balance. All said-and-done, US Bank has taken $349 in ODC's, half on positive balance and half on what *would have been* positive balance if the first half of the ODC's hadn't happened. I am still unsure how US Bank has the right to charge me ODC's when my balance is positive; I am meeting with a US Bank manager today.
Lori
This practice is something that has been happening to me since I went to online banking with Bank of America and have been a good customer for 12 years. When I complained they said that they can't control when the transaction comes through which is a lie because any that go through on a debit/Visa go through immediately and I have proof that 4 small transactions went though two days before the only one that I should have been charged for. Their comment that they are protecting us from larger amounts like car payments from bouncing is also hogwash because with all the fees I couldn't pay my car payment anyway. Far as I know all banks do this.
Wendy L
At 17, my daughter opened a student acct w/ a check card for use while away at college. And that is where she learned about Posted Bal. vs Avail Bal. and courtesy overdraft "protection". This "protection" continued even after repeated requests to remove it including several requests from me. We did finally get a letter confirming that it was removed. Two weeks later, a deposit after 2:30pm followed by several small check card purchases incurred $359 in overdraft fees on an account that had a $100 posted balance.
Evidently, Opt Out prevents transactions based on posted balance, yet the overdraft fees are incurred based on available balance.
We have subsequently paid the net overdraft charges and closed the account.
As a banker, at Wachovia, it disturbs me to know that my daughter did not learn cash management skills through this experience; Instead she saw a shell game played.
She now believes her money is safer under her mattress. She is our next generation.
Derek B
I've actually had a bank (AmSouth) reverse fraudulent activity but refuse to reverse OD charges on the fraudulent activity. Their rationale was that my checking account falling into the wrong hands was still technically my fault and so I was liable for the OD fees.
I now withdraw 90% of each deposit in cash that I keep in a safe in my apartment and purchase money orders to pay my bills. I use credit cards for online transactions. IMHO checking accounts and debit cards can no longer be trusted. This bill would go a long way but it is likely to face serious opposition from the bank lobbies.
Library
As far as the comment from Julia goes I wonder whose problems she is talking about . This is not about not taking responsibility. There was a bill introduced several years ago to speed up the time for a check to hit the account however the amount of time that it takes a deposit didn't receive such adjustments. The robbery mindset of the predatory banks is one of buyer beware however you cannot be aware of something you don't know about. The level of high-handedness when it comes to the banks and credit unions removing this so called protection is likened to Loan sharks offering protection on the streets. You pay for something that you don't need. When you need to be protected from those offering the protection.
Sheldon H.
Does anyone read their Deposit agreements or their OD Policy when they open an account?
Everything is spelled out right in front of you when you open your account and sign the account agreements. If you happen to use your OD, you are using money provided to you by the Bank to cover for money you would not have otherwise. If you did not intend to use it, balance your check book and get a statement print out every week or so to see where you are at in your account.
Hawaii
Join a CREDIT UNION and become a member-owner with a voice that makes a difference.
RCC California
In response to Julia's remarks several posts above. You can harp on the personal responsibility thing all you want. You are correct, many Americans are terrible about managing their personal finances, and I admit guilt to some degree to this myself. But, there is no way that banks have the right to gouge customers with these ridiculous overdraft fees. Wells Fargo charges from $12 to $30 per overdrafted transaction. So if you go negative with a $100 debit charge, and several other transactions go through after that (scheduled bill pays, another debit transaction, a cashed check, whatever) you will get an overdraft charge per transaction. This can amount to hundreds of dollars for overdrafting your checking account for a day or two. It is wrong and must be stopped.
Howard
Oh Julia...
You know that banks make millions per year on stacked overdraft charges. Posting debts first, credits second. Holding credits. All these practices are standard in the industry. This needs to stop and everybody here needs to alert their legislators to pass this bill.
CU in AZ
It sounds to me like the vast majority of you have never experienced true financial service...you seem to be conducting your financial transactions through banks, and probably large multi-national ones at that. I agree with Hawaii, you need to become members of your local credit union(s). I hear a lot of things about the order of transactions that are posted. If there is a deposit that is made into your account from an ATM (especially if it is an ATM that does not belong to your institution) they have the ability to place a 2-3 business day hold on the funds, and only release a portion of the funds immediately. This helps to shield financial institutions from losses concerning fraudulent ATM deposits (which happen much more frequently than you might think).
CU in AZ
Additionally, per VISA regulations, there are many times that debit transactions may not have “posted” to your account, but an authorization has been received to debit funds from the account. As long as that authorization has been received, your institution is legally bound to VISA through their operating contract(s) to pay that item, no matter if it draws the account negative or not. Your banks should be offering you other alternatives to these overdraft programs, perhaps an open-ended line of credit that is used solely for overdraft protection (these credit lines generally carry high interest rates, but if they are paid off in a timely fashion…within one month…the interest charged on these balances along with the much more minimal overdraft transfer fee, usually around $10-15 for banks, $5-10 for credit unions, is much smaller than the multiple NSF fees that are charged by your institutions.
CU in AZ
To speak to Howard, these “industry standard practices” are strictly governed by laws. In order to shield financial institutions, and ultimately all consumers, from the ramifications of fraudulent deposits, these “holds” on credits are required. Ultimately, the consumer is responsible for covering the costs associate with bond insurance that all financial institutions have to pay in order to protect themselves from losses related to consumer-initiated fraudulent activity.
CU in AZ
Working for a credit union myself, could be called biased, however I have never had an account with a bank, and I doubt that I ever will. Even though banks and credit unions are governed by the same legislation (for the most part) credit unions are more consumer friendly by their very nature. I strongly urge all of you that are dissatisfied with your current bank to explore your financial options at your local credit unions. Most credit unions offer all of the same services and products that our banking counterparts offer, but at reduced costs, seeing as there are no shareholders, but instead member-owners. Belonging to a credit union gives you a membership interest in how it conducts its operations, and that is much more control than a bank will ever give you.
Brenda Mortensen
I hope this bill passes. We overdrafted without knowing at 5/3 bank but the website said we were fine. They paid our overdrafts starting with the largest, bypassing several small charges. They charged us $33 ea for several overdrafts + $6 ea day we were overdrawn. When we realized our error we called and they sold us a credit card for od protection saying that would take care of the problem. In the meantime we made several deposits trying to catch up but had holds put on checks that were from the bank next door. Everyday they pulled more fees out sending our account into the neg again. It's cost us around & $1000.00. I have never had this happen at our credit union.
Nate Moore
I'm very much pro-capitalism, pro-business, and pro-corporations, but I HATE BANKS!!! I bought a $4 item one evening using a debit card, then made a deposit the next day. Yep, $30 overdraft fee. Guess what the APR is for that short-term loan? About 273,750%. What if I had tried to buy a $400 item with that same debit card? Yep. DENIED! Manipulative **EXPLETIVE***.
Juan
I disagree with Julia and a few others. First, banks are manipulating the overdraft fee practice by simply allowing debit cards to run over the limit without any cap. Credit card companies decline any further charges when there is no available credit. Banks can easily do the same with debit cards.
Second, the charges issued for overdrafts are excessive. Unless the bank can prove they were damaged by the activity, what right do they have to gouge the consumer? Someone explain that one to me?
kwinkle
I agree that each person is responsible for thier finances, however, when a bank (fifth third) charges an overdraft fee (33.00) for a PENDING charge that is just not right. A pending charge can be several things - and in my case it was a charge that was done incorrectly and then charged back (canceled) but I was charged ODF. When bank was contacted they refused to give it back! My actual daly balance was never overdrawn! that is not right
William
It is amazing to note that the number of complaints stem from the fact that you do not keep up with your bank account balance. It is easy to blame others and not yourselves. Do you not have faith in your ability to manage your own personal finances? I have had ten overdrafts in my lifetime and each time was due to my mistake. You deal with it and do your best to make sure that you do not let it happen again.
dmaka
Why is it ok when a consumer makes a mistake on their account, such as an overdraft, that a bank can charge a fee, but when the bank is at fault --say for charging a fee when they had no right to -- we can't charge them for stealing from our account. Banks and their associates are corrupt.
Juan
William --- I forgot the banks are our friends. Give me a break! They will utilize whatever component the law allows them to maximize their profit. Is it the account holders responsibility to maintain their balances? Of course. However, should banks be allowed to exploit an overdue balance for the sake of charging exhorbatant fees? I don't believe so. This is no longer a case of someone writing checks without sufficient funds. The main culprit are the debit cards. Banks can easily adopt a system that will decline purchases when there aren't sufficient funds to pay for them. Why haven't they done so?
Bandon Trapp
lol I don't care im Rich
Sarah CA
I was overdrafted like $1.09 when there was money in my account and it caused all kinds of charges which took my whole paycheck for the month and then since it did that all the automatic withdrawls bounced and now I owe $500 plus and I don't have a paycheck to pay any of my bills this month and on top of that I am a college student and they bank, US bank told me to let the fees ring up rather than send it to collections because it wouls ruin my credit. I can't even afford food right now I am borrowing money $5 dollars here and there so I can eat and take the bus to work. I have two jobs now and I think I am going to loose my place that i am renting. What should I do? Oh and they opened my checking account before I was legally 18 and they knew this and didn't tell me it was illegal. Help me please my email is cesaresbaby@yahoo.com. I am willing to go on television about this.
Derrick
BBT. This weekend I forgot to swtich an automatic deduction from the 14th (sunday) to the 19th. Subsequently I made purchases within my balance over the weekend that had the funds there to cover the charges. However, last night at midnight - even though the automatic deduction was the LAST item on the list. They tried to pay that first causing every other transaction to be an overdraft. I am paying what money I actually owe the bank, substracting all the overdrafts. Then I am closing my account. They are going to have to go to court to get this money out of me this time, so good luck with that BBT, or should I say "Ball Busting Trust!"
Brenda
This has happened to me on more than one occasion. This last instance was with Eastern Financial Federal Credit Union (Florida). When I started getting hit with 2, 3, 4, 5 overdraft fees at one time, I checked my online account and discovered that I still had a small amount of money in my account when I accrued the first overdraft payment, but my transactions were manipulated to make it look like it wasn't the case. Furthermore, I had been charged an additional $25 for a set of replacement checks...that THEY lost. I've disocvered that it's actually cheaper for me to take my paycheck to a check cashing store and pay their fees (which, as high as they are, they are at least up front about) and keep money on a pre-paid credit/debit card than it is to have my check direct-deposited into a checking account, where financial institutions basically have their way with my money. It has gotten to the point where I cannot pay my bills, and it's only expected to get worse.
Les
Why not just get an overdraft line of credit linked to your checking account? That way, when you bounce a check your credit line is accessed and all you pay is a tiny interest charge VS those "Courtesy Pay" fees! It's GREAT! By the way, you can "opt out" of "Courtesy
Pay" anytime. Call your financial institution and find out how today.
Tommy Wilson
I bank with Huntington. And after accumulating ODF's numerous times I watch my account now obsessively. Used to when I would "pay at the pump", it would show a $1 transaction online until it cleared. But when printing out my transactions daily I would replace that amount with the actual amount I purchased. But recently I noticed that after 12 hrs this $1 vanishes from my transactions for 3-4 days until it clears. So if I would not check it with 12 hrs and forget about the gas purchase, it gives me a false balance of what I really have. Then….SURPRISE! WHAT A SCAM!!
Tommy Wilson
Another pathetic attempt by Huntington Bank is using to gain ODF revenue is by using standard monthly checking fees to force their customers into the negative. I went back 6 months and noticed that they are NEVER charged to my account on any specific date. Or anywhere close to the same date for that matter. They are ALWAYS charged to my account when it is at it's lowest. Twice causing it to go into the negative. I cannot believe that!! I have to say that surprises me for than the whole "pay at the pump" scam.
Chris Stewart
WACHOVIA OVERDRAFT ABUSE - Hopefully that will make WACHOVIA show up in search engines for their abusive practices. My wife's payday changed and as a result some of our bills were paid according to the old schedule. We caught the error in enough time to only be $60 overdrawn and took immediate action to correct the mistake. WACHOVIA's customer service agent DOMINIC DEFAZIO told me if we made a deposit of $61 we would not incur charges. At the bank with cash in hand to correct the deposit I was told I had a $400+ negative balance as a result of overdrafts. I told them Dominic Defazio told me otherwise. They told me to call him to get him to fix it. I called and "conveniently" he was not available. I asked them to pull the call and listen to it to hear what their representative had promised me. "Conveniently" all their systems went down... CROOKS!
Theresa
Within the last 2 days I was just charged $490 in overdraft charges on $253 in REAL transactions applied against a balance of $287. The bank's non-transparent accounting (and often manipulative) methods for assigning these OD fees MUST STOP. How can any reputable bank charge one of their customers $490 in fees when no actual REAL overage happened ? How can congress let this continue ? How can banking executive in clear conscience allow "nebulous" unrealized transactions to trigger these excessive and escalating OD charges ? Have you no sense of social responsibility ? SHAME ON YOU
Nicole
The way to make the banks take notice is to stop using your check card. That is what I am going to do. The website Center for Responsible Lending quotes banking industry disclosures regarding profits ascribed to OD charges. It is a multi-billion dollar game. Unless Congress forces them, or grass-roots consumer organizing causes wide-spread boycotts they aren't going to address this voluntarily.
Theresa
My problem was with Wachovia as well.
Someone should put the Investigative News concerns on to this issue. 60 Minutes would do a very nice job of demonstrating the extent of this problem.
Theresa
More on Wachovia at MSN Money:
http://articles.moneycentral.msn.com/Banking/BetterBanking/WhenBanksTur... />
Seems the problem I encountered is a wide-spread one due to their policy on how they process transactions.
TIME TO CHANGE YOUR POLICY WACHOVIA
Bill in AZ
CU in AZ has it right - credit unions are far superior to banks.
I'm self-employed so I get paid with checks drawn on a variety of different banks. If I go to Wells Fargo & deposit anybody's check, it's "pending" until the close of the next business day; for WF checks I have to cash it & then deposit the cash in order for it to show up immediately.
If I go to Arizona Federal CU with a non-AFCU check, not only is it effective immediately, but I can even get cash back.
Re: overdraft protection, I had my WF account linked to my credit card which would save the $34 OD fee, but that's considered a "cash advance" so you pay the highest interest rate.
Phil
Banks use creative accounting methods to help put accounts into the red, so they can get the maximum number of overdrafts fees that they can. The reorganization and order of how the debits and credits are applied to accounts is just one of their magic accounting techniques. These practices should be illegal and changed. But, the way it stands right now, "the Banks steal, and our Congress is driving the getaway car."
Phil
Electronic Fund Transfer Act. If a financial institution does not follow the provisions of the EFT Act, you may sue for actual damages (or in certain cases when the institution fails to correct an error or reaccredit an account, for three times actual damages) plus punitive damages of not less than $100 nor more than $1,000. You are also entitled to court costs and attorney's fees in a successful lawsuit. Class action suits are also permitted.
Phil
It sounds like some of you people should take it to court
Chuck
I have no problems with banks charging fees for overdrafts. But, they should be in proportion to the amount of the overdraft. I had an overdraft of $3 one time and recieved a $30 fee. I was able to get it reversed, but two things need to be changed:
1. stop the "smallest to largest" clearing that maximizes fees. It should be the other way around.
2. Charge a percentage of the overdraft up to a maximum amount. If you overdraft by 10, then make it 20% ($2). Not $30.
Regardless, this bill will never see the light of day. It will be held up in committee because many of those in this committee are being bought by banks and thier lobbyists. The little guy has no power in this country. At least Rep. Frank is doing something about it.
Jeff M.
I would be VERY interested in knowing if there are ANY class-action lawsuits going on especially against Bank of America on overdraft fees. Unfortunately Im an BOA customer and also paid numerous overdraft fees. It would be extremely helpfull if anyone knows of any class action suits against BOA
TF
I'm a college student and overdrew my account on book by $1.58. Because I had two transactions from the previous day that were still pending the smallest of these two was considered overdrawn when they actually posted to a negative account, even though they were purchased on a positive balance. 5/3 then charged me another overdraft for the actual transaction that overdrew the account. In the same week a local advertising club automatically charged me for a membership that I had deactivated from. The club refunded my money but 5/3 would not refund the overdraft fee and said that the club was responsible for paying the fee. How do I as a customer control for when or what order my transactions go through? If I can't control for them, then how am I supposed to prevent them? This is by far the most frustrating thing being a student and trying to make ends meet. I feel like I'm working for a bank but instead of selling me labor I'm giving them every penny I have.
EdC
Yes, Jeff M. there is.
Copy & paste:
http://www.milbergweiss.com/page.aspx?pageid=5316
TMassie
17 billion in overdrafts last year, up 85% from 2004. Are we that strapped or careless with our checkbooks these days OR are banks manipulating their systems to increase profits off ODs, creating ODs themselves and/or charging OD fees where no OD exist? Wachovia does all of the above. The last 90 days I have been charged $500 in fees. 4 times no OD existed and on 1 they created the OD themselves. They post items against the available balance and if that balance is overdrawn on any given day,then they charge a fee for every other item they pay that night, even if the actual amount of money in the account is sufficient to pay all items presented. I also went through all my statements and found out they have taken over 3500.00 in fees. I filed a complaint with the OCC, hopefully they will see what Wachovia is doing is unethical. They need to post items against the actual amount of money in the account (posted)and if that amount is insufficient, then charge an overdraft fee, not before.
TMassie
I may be taking this information the Texas Attorney General too, not to mention all my local newspapers and TV networks. Its just crazy how Wachovia can justify charging fees against items they pay with my money. If they pay items with their money, so be it, they have floated me and I can understand a fee. But when they base their policy on assessing fees against a balance that includes items they havent even paid yet, then that's just plain unethical.
MinTExas
to CU in AZ: Those overdraft protection programs that use a line of credit or credit card will kill your credit rating. We had this happen with Wells Fargo. They signed us up with overdraft protection but didn't tell us that they would use our credit card and every time that we overdrafted a deragatory mark was posted on our credit report. Other than the overdrafted stuff we hage no late pays or unpaid stuff, our score fell from 760 to 599 in less than one year. DO NOT trust overdraft programs from big banks
Misty
It is appauling that I have to physically go to my bank to sign an "opt-out" form, yet they never required my authorization to "opt-in." I have been banking with F&M for over 12 years now, and they added the OD protection to my account just in the last six months. I proclaimed that I never requested such protection, and was told the feature was disclosed in one of my previous paper statements (does anyone even open their paper statements and read the junk inserts? Not me). They said I had the opportunity at that time to opt-out if I didn't want it. Anyway, she reversed the fee and said she was cancelling the OD protection. Now six months later I find an OD fee of $28 for a $4.20 cup of joe (667% APR).
I'm going this afternoon to close the account and transfer my money to my credit union account. FYI: my credit union is no hero, they pull this crap too, but they only charge $10 for each OD. I SUPPORT THIS BILL 100%.
Jeff
You can always tell the people who work for the banks or who are rich.
An overdraft is between me and the retailer, not me and my bank. If I overdraft then the retailer is who I should answer to.
If the banks weren't so blatant in the way they reverse stacked the transactions, I probably wouldn't give two hoots, a single overdraft is just unreasonable. Many for no reason is robbery.
Cheryl Smith
I made a cash deposit to the ATM on a Friday evening, at my bank branch. The mortgage payment was due to come out automatically on Monday. The mortgage payment bounced. The cash amount was enough to cover the mortgage. I understand that with automatic withdrawals, there may be a problem, as they are automatically withdrawn. I also understand now that cash deposits to ATMs are not advisable. Bank personnel confirmed that the cash was received by the bank from the ATM. They credited the deposit at the end of the day Monday. Had I WAITED and brought the cash inside to a teller Monday morning, there would have not been an overdraft. Even acknowledging that the money was in the bank Monday morning, the bank refused to reverse the overdraft.
C. Calvert
I strongly believe that the LaSalle (the new B of A) is aggressively using hold tactics and other means to generate overdraft fees. I read one comment where someone was charged ten fees for five overdrafts because of how they set their holds. And, it appears that once a fee comes in the same hold on your money which they would not release to pay $1.52, they will release long enough to deduct their overdraft fee. Thus, ultimately they send you reeling into overdraft hell. SOMETHING MUST BE DONE!!
Ian Sanderson
Abusive overdraft practices helped throw me into bankruptcy at age 23. I was charged over $800 in fees because Charter One Bank situated my debits largest to smallest to generate more fees. It took me 5 years to have another checking account. Americans should not stand for this treatment by banks any longer! I SUPPORT THIS BILL.
Allen Harkleroad
This needs to be further regulated and perhaps a uniform code of procedure and clearer disclosures. Bib banks get big because of this sort of stuff. Try smaller banks they tend to help rather than hurt customers/
Jon Honeywell
This bill does not outlaw these fees. It seeks to make them more obvious. But of course, all of the posters above are aware of them, and no doubt signed a form agreeing to these fees when opening their account. From reading their comments, you can see that their reason for supporting this bill is that they want revenge against some bank for a mistake that they themselves made.
There is nothing inherently wrong in charging these fees. If you don't like this practice, inquire about opting out of the service, take more care in tracking your personal finances, or simply move your money elsewhere. That is the most powerful thing you can do in our market.
Don't abuse the legislative system to get revenge for your mistake!
Ryan
It was only a matter of time before some idiots came on here to misunderstand the issue and lecture us all on "personal responsibility." This is not about bailing out those who negligently forget to have enough money in their checking accounts. This is about the banks actively trying to screw you over. With bank profits plummeting, expect to see much more of this shady behavior on their behalf.
Jerry
No fees! If insufficient funds, the bank should either pay (and limit themselves to the maximum legal interest rate) or not.
Chris
I was reading someone's comments above who said that the banks have a right to charge a fee. While this may be true it is just not right to rearrange the order of transactions on someone's account in order to maximize fee revenue. In some cases, this "restructuring" creaes overdrafts that aren't originally there. I think the majority people here would agree that overdraft fees are necessary for the banks, its the manipulation of transactions , i.e. ordering from largest to smallest during the posting process that is the problem. I tihnk this bill will be a great way to protect consumers.
Albert
I asked my bank (Bank of America) to disable the ability to overdraft my account -- simply dishonor checks and refuse ATM withdrawls if the account was overdrawn.
They refused, saying it was a "service" that customers find valuable.
This has to end. If I can't opt out of "overdraft protection" then it needs to be heavily regulated.
Enginerd
Customers should be able to opt-out of any overdraft fee program. Meaning, if you try to pay with your debit card or a check and you don't have the funds, the transaction doesn't get approved (i.e. check bounces, debit card rejected). I believe this bill does that, although I'm not 100%. What it specifically says is that ATMs or electronic transfers have to warn you if you're about to overdraw your account, which is good.
I would favor making the language more clear in that regard, and if the bill doesn't do that, make it.
rogerborn
It is plainly immoral for American banks to make billions of dollars off their poorest customers. Well-off customers can to protect themselves from overdrafts. The bank says these 'fees' are really a temporary 'loan' to me for a short time (hours or days), until I replace the money that was short. However, their ‘fees’ come out first. If that bounces more items, so much the better for them. The next day they will take out those additional ‘fees’ again, and perhaps bounce more items. This can go on for days until payday. These ‘loans’ can amount to several thousand percent interest rate. If they were real loans, the government should be prosecuting the banks for loan sharking under the RICO act. (The bank may also inflate a customer’s website balance before payday to cause them to bounce something.) Loans or fees; either way they are much too high, and the real cost to the customer who is victimized by them is measured in fear, misery and increased financial stress.
Antonio Khan
The overly aggressive banks design their software to maximize overdraft and other punishment fees. Wamu has always been one of the greediest banks I have ever dealt with. If a deposit is coming to the checking account, they will also let the debit go through first before the deposit is credited, even if the deposit is made earlier than the debit. Say you have $200 balance and you deposit $800. You debit $198 and $5, and then $700. Their system is programmed to debit the $198 first, then $5, which causes overdraft, even if you made the deposit, then they will debit the $700 and then apply the deposit. This way they earn overdraft fee twice. I detest this practice and closed my account a long time ago, the other banks I use don't even come close to being such unscrupulous. This is used to show how their software is designed to trigger overdraft fees even of the overdraft itself is $3 and the fee is 1000% more than the overdrafted amount.
Vince
Essentially what the banks are doing when they give provide overdraft service is they are giving you a personal loan. Say you overdraft your account by $100 in one tranaction and the bank's service fee is $35. You then pay back the service fee and the overdraft amount in 7 days. The bank is charging 1563% APR on that personal loan.
Things get much worse when a big transaction is pulled from the account first, followed by several smaller payments. Say you had a $1000 balance and had one $1100 transaction and 5 $20 transactions. You are overdrawn in your account by $200. The bank charges you $35 per overdraft for a total of $210. Again, you pay the bank back the fees and overdraft amount in seven days. The interest rate in this case is 3739% APR.
I'm sure you can find a nice loan shark that will give a better rate than that.
Dee in Ohio
I was simply aghast when I tried to cash a friend's check, payable to me, at her bank. The band wanted to charge me a $7 fee for cashing a check DRAWN ON THEIR ON BANK because I didn't have an account there. This is beyond despicable. They've gone way, way, way to far. This is robbery and it must stop!
Donald Theobald
I am tired of US Bank manipulating the order that checks are cashed so that the maximum number of checks can be overdrafted and charged for in their favor, cash the dam checks in the order they were written, no the bank can make more money.
Thank you!!!
Aimee in WI
I really hope this passes. Banks will just keep right on screwing people as long as it is allowed. It's terrible!
Debbie C
I had money in my account at Wachovia.. enough to cover my charges and suddenly all my money was gone.. they charged me overdraft fees when money was in my account.. the first was in a set of 3 overdraft fee of 105 which even left me a balance of a positive 12 dollars which i have on a statement ... then i actually did have overdrafts b/c of the money they stole.these people are criminals.. theft by deception and they are getting away with it.. they need to be in jail.
David in KS
The "predatory" actions adopted by financial institutions of all types has skyrocketed in past years and it MUST come to a HALT! I was recently shocked by an overdraft fee yet my account was NEVER negative. Calling for correction of what surely was a mistake, I was informed the overdraft was for a pre-authorized payment (an online bill pay pre-scheduled in advance) and being applied because my account did not have funds to cover the debit on the day submitted...not when it processed, but on the day weeks earlier when I pre-scheduled the payment!! If I honestly overdraft my account, I am not opposed to paying a fee reasonable to the services rendered; I am highly offended by banks / credit account lenders who forget all promises to the consumer & manipulate any means they can if it brings in a buck with no overhead and the legal department thinks they will get away with it.
KELLY IN NC
I needed money 2 days before my payroll check was direct deposited into my acct. So I agreed to pay the 35.00 overdraft fee and withdrew 400.00 When my check was deposited, they had gone back up to 5 days prior and hit me with 9 overdraft pen's. I had enough money in the bank to cover all of my debits until i withdrew the 400.00 I should have been charged 35.00 not 315.00 I have to go get a pregnancy test now, because I was f----- by Suntrust...
Ely AZ
Overdraft is a service. Customers have the right to opt out. Opening a checking account w/ a debit card is exactly that per se. I did not sign up for such service hence I'm not going to pay for it. I did not authorise the bank to overdraft my account and technology is there to show I have no available funds. I do not expect any restaurant to charge me for smtg I didn't order. Simple as that. Overdraft Protection is a meta-service but after I agree to OD. To keep a register is a moronic advice - then better keep cash and don't bank. OD requires class action lawsuit.
Brighsco
I'm reading a lot of anger here (duh - right?) but here's the thing:
1 - if you don't reconcile your checking account and don't keep tabs via your bank's online service on what hasn't cleared - and keep on spending money - you're going to OD your account and get charged fees
2 - transactions are cleared against our accounts based upon when transactions are presented for clearance - which may bear no resemblance to the order in which, say, checks are written. Banks typically prioritize a day's worth of items highest $$ to lowest, the thought being consumers probably want their mortage/larger items to clear before the small ones
3- read the inserts that come with your bank statement - don't just toss them (I guess if you don't reconcile your account, you're tossing the statement, too)
4- NSF/OD fees are just that: fees - not interest on a loan. These fees recoup the cost of rehandling items that don't clear and notifying consumers of the event
Linda Richardson
The bank purposely withholds the debits hoping for you to make an error and then they process all the previous debits after the one that took you over at a cost of $30 - $35 fee per debit. When you call them on it, they say they have no control over how and when the debits are completed. If you check your account electronically each day, you expenditures show they are held in a "pending" status and at the same time they are subtracted from your available balance as if they were completed. THIS IS A SCAM THAT IS PROBABLY CONTRIBUTING TO THE HIGH RATE OF FORECLOSURES IN AMERICA. We are not dumb. We write down our transactions in our balance books, we check our accounts electronically, and we check our accounts through receipts at the banks.
Jutta
For the most part, I agree with those who say that consumers should balance their checkbooks.
However, I'm a conscientious, anal-retentive consumer who did just that and was $60 in the black when I mistakenly used the wrong debit card the following day (oops) which put me $50 in the red.
My stupid but honest mistake was manipulated in such a way that I got hit with 4 NSF charges ($152) on a transaction that should have been declined in the first place. I'm willing to pay 1 NSF charge, but not the other 3. Small Claims Court here I come.
Compass Bank
This durn bill ain't gonna do no good fer us nohow. If this gits law-like we're gonna hafta done shut our doors down.
We needs them fees so's we kin pay fer "free" checkin' and feed the hawgs.
Ben
I mistakenly used the wrong bank card and Wachovia charged NSF ($39) as a courtesy for me. The stated they authorized the purchase although that account has had a balance of $1.96 for months. They stated that because I'm such a good customer they allowed a purchase on my card even though the balance was low for months. Tomorrow I will go and close the account at Wachovia. My internet bank does not charge ridiculous fees and actually pays me interest on my checking balance. I urge every one to close your Wachovia accounts.
kris
i check my account online and via phone several times a day, if an overdraft looks possible i make sure to transfer enough money in time to cover it, last week i was charged 5 fees by bank of america when my account was never even overdrawn. when i checked online at the items i was charged the fees on my available balance was still positive after the transactions cleared. when i called the bank they said that there was an item in pending that would have overdrawn me if it cleared, they charged me 5 fees of $35 because i had the potential to be overdrawn.....how can that be allowed, how can i be charged a fee for something that never even happened. oh and i am also switching all my banking to my local credit union, bank of america is crooks!
Eugene
I have been reading all comments posted here. You all have (1) thing in common! You must not be aware of applying for a "credit line" to protect against overdraft. It's much cheaper than paying NSF fees! Apply for a line today!!! I did.
BANK PROGRAMMER
Ignorant people state – “IT’S YOUR OWN FAULT”. “THERE FOLLOWERS AND NOT LEADERS” They only repeat what’s been told to them. Bottom line is – banks want your money. Banks want your money, even if they have to steal it. TRUTH - Law’s have changed several times over to speed up the process of withdrawing funds from your account but deposits haven’t changed in almost 20 years. BOTTOM LINE IS THIS – IF YOU HAVE LIMITED FUNDS AND CAN’T AFFORD TO LEAVE AT LEAST A 1,000 – 3,000 BUFFER IN YOUR ACCOUNT, USE CASH. THIS IS THE ONE THING THAT BANKS CAN’T DO ANYTHING ABOUT. OTHERWISE, BANKS WILL TAKE ATVANTAGE OF ANYONE WHO DOESN’T. I’VE BEEN A SELF EMPLOYEED CONSULTANT FOR OVER 8 YEARS. I WRITE THE PROGRAMS THAT BIG BANKS USE TO SCREW OVER THE CONSUMER. THEY USE MY DATA TO MONIPULATE THE BANKING RULES TO GET MORE FEE’S FROM YOU. THERE YOU GO – STRAIGHT FROM THE HORSES MOUTH. PUT THAT IN YOUR PIPE AND SMOKE IT BANKERS.
Rob P
I just got hit for the $12 overdraft transfer fee on my Wamu account. It was actually my error that this happened because I didn't check my paycheck had cleared before using my debit card and I knew that the savings overdraft transfer activated according to "available balance". However, I got paid that night at midnight so only for a matter of hours my available balance was overdrawn by $29, and not my actual balance mind. The problem is it's just unfair. The actual cost of making this transfer has to be nothing. It’s surely a few lines of code that they apply when you opt in, a few volts of electricity and an automatically generated e-mail. Does that really cost Wamu $12? It can’t. A successful challenge to unauthorized overdraft fees was mounted in the UK in the past few years with millions claiming back excessive fees levied by the banks. Surely a patently ridiculous charge for moving a number from one column to the next should not be allowed! Will this new law prevent this?
Todd
"Don't abuse the legislative system to get revenge for your mistake!"
This argument by the "personal finance" proponents grows weaker every day as more algorithms are created by the banks to maximize overdraft loan interest, not "fees". These tactics will only get worse as the banks are unable to make money in the loan market and seek to maintain revenue. They are eroding faith in the banking industry and therefore many deserve to fail without a bailout from the Feds. WaMu and BOA are notorious for fee origination tactics and the overdraft "fee" is their primary weapon. It is time our do nothing Congress begins paying attention to the 68% of Americans who live paycheck to paycheck and restore faith in our banks by assuring us they are no more than predatory lenders. Most of those in representatives have proven time and again they are afraid of the banking lobby. Those preaching financial accountability have little understanding of the level of account manipulation.
Todd
Want to discuss this as a personal finance management issue? Listen to this: On 7/30 I had $68 in the bank. On midnight 7/31 my direct deposit went into WaMu. On their website the deposit showed as "pending" but the balance showed as "available" at 7 AM 7/31. Therefore the funds are available correct? Wrong. I used a debit card twice that day for transactions of $160 and $208. The following morning, 8/1, both of them showed as negative transactions ans corresponding overdraft fees of $34 each. So, WaMu can legally show funds with a label of "available balance" and charge overdraft charges when the "available" funds are used. They base this on the fact that they claim the "post debits before deposits" but somehow show the deposit in the "available balance" first. This is immorally corrupt on a new level. It should be a crime and WaMu should and most likely will fail soon. They're desperate and they've lost a customer as on Monday morning.
Traci Wojnowski
I don't have a problem if I am charged an overdraft fee when my account is really overdrafted. If I have "pending" credit transactions, this should not go against my balance until these are posted. This week, I had pending transactions, which caused at the time of my last real transaction to be -29.82. I did go to the bank that same evening and deposited a payroll check for $265, however, it didn't post until the next day because I was there only 10 minutes before closing so it showed being deposited the next day. I was then charged $187.50 for overdraft fees...what a racket. They had the money, but apparently the overnight hours didn't count? If I wouldn't have deposited the money, I would still have been charged the $187.50. I agree that consumers must be responsible, but it does get to the point that they are a bit ridiculous. When I contacted US Bank they said although they were sorry, this was in their policy. Understood, it just seems nuts.
Traci Wojnowski
My account balance was $310.94. They processed a check for $159 and a check for $110.12. I also had charges that had not posted for $48.16. This made me -6.34? They didn't post, I couldn't be negative. At 8:30 on 8/9, I deposited $700 into my account. On 8/11 they charged me $37.50 overdraft. When I inquired they said that they place a hold onto your account for that amount from the time they recieve the notice until the item is presented or 3 business days. During that time, suffiecient funds wouldn't be available to pay checks. If you used a regular charge card on Monday, and your bill was processed on Tuesday, but the charge company didn't receive the actual charge you wouldn't be charged, nor would you be charged interest for not paying that amt Banks offer debit cards and tell you to use it as a credit card otehrwise they will charge you for debit transactions. If you use it as credit, they will charge you overdrafts, so where are you benefiting from their services?
Joe
This mugging and raping of the consumer has got to stop. The banks claim it's up to the consumer to know how much they can spend, but how could they when most consumers rely on banks account balances on the banks internet websites for their balances BUT these balances are NOT displayed in real time. Some times two or three days behind. If a consumer does not have sufficient funds during a purchase a warning message should pop up on the screen telling the person that they will be overdrawn and subject to a fee. I suggest that these criminal banks should be made to reimburse all these fees they robbed from the consumers from the last 3 or 5 years. Let these fat cats feel the pinch that so many of us have felt.
Bev
No one today takes responsibility for managing and balancing thier check book. Instead, as soon as a check bounces it is someone elses mistake - not mine. Further, when my bank paid a check of mine that overdrew my account it actually saved me embarrasment and additional fees that would have been incurred by me by the retailer. Ina ddition, you can go to jail for passing bad checks.
Joe
Most people don't use checks anymore so acurate account balances are not readily available. All banks now days promote debit card use for a particular reason....profits. The real problem is debit cards and the lack of controls that banks purposely keep out during purchases for the simple reason of ensnaring consumers into over drafting their accounts and collecting hefty fees for it. Banks could easily have alerts warning consumers that their account will be overdrawn during these transactions and give an option to the consumer of whether or not to continue with the transaction and give notice that a liability will be incurred. For heavens sake this is the computer age it can very easily be done but banks don't want to for the simple reason that its a form of legal robbery on their part....period!
Steve
I am trying to help my brother manage his finances so I opened a spending money account for him so that he could spend money from that account using an atm card without worrying about the balance. All his bills would be paid from another account and this account would just receive a fixed amount electronic transfer each week. I also specifically said I did not want this account to be allowed to overdraft. Wachovia set it up so that he could withdrawal money from it through ATMs even when he had no money so they could collect overdrafts. He now is out a whole pay check because of overdrafts.
People who are criticizing this bill don't understand the situation. Banks are purposefully allowing people to overdraw their accounts using atm cards even when the accounts have no money. Banks say they are doing this for the consumers but consumers overwhelming say they don't want this.
Traci
What I don't understand is how can they charge a fee for a check clearing because of a "pending" transaction". Then, charge a fee for the "pending transaction" to clear. It is like they charge for it 2x. If using a debit/credit card immediately is going to charge your account and immediately withdraw the money. If you then have a check clear, you deserve an OD. However, you don't deserve the OD on the charge because it happened first, right? Not the way the bank sees it. They are charging 2x for the same issue.
Nathan
The Bank is supposed to be providing a service to you. Fees are the way they prosper in doing so. But greed has corrupted this institution and the government has sat twiddling their thumbs as BILLIONS of dollars are stolen from the American workforce. This bill may be a kind sentiment but is too little too late in my eyes. How a government can investigate payday loans (which costs about $40-60 a week for a $500 loan) as a potential rip off, and not look at bank fees (which charge $20-45 per transaction for overdrafts and non-sufficient funds) is insane. The banks are not looking out for their customers, and the government has failed its people regarding regulating the finance and insurance industries.