Dear Sir,
Since the change of the laws governing a bank's ability to charge overdraft fees (summer 2010), making them ask the banking customer if they wish to "opt-in" to the Courtesy Overdraft Protection, has allowed banks to charge overdraft fees on items that don't put the customer's account into an overdraft status.
In short a banks ability to charge excessive overdraft fees has not been curtailed, just the opposite, the door has been opened for banks to further leverage fees against their customers. The 2009 estimate of $38.5 billion generated from overdraft fees, according to USA TODAY research, may be a drop in the bucket.
Let me explain
I have several accounts at the bank that I use, First National of Texas/First Convenience Bank, headquartered in Killeen Texas. Home of Fort Hood the largest active duty armored post in the United States.
When reviewing my account online I noticed that I had been charged several hundred dollars in overdraft fees while the balance was still positive. I called the bank and the following is a transcript of the explanation I received.
Phone call
Good Morning Sir.., my name is % how may I help you today?
I'm calling about some overdraft fees on one of my accounts.
I'll be happy to assist you with that, what's the last four numbers of the account?
_ _ _ _
Ok sir, I have that account up. How can I help?
I notices that I was charged $419.64 in overdraft fees. However the account has a $8.33 balance.
Yes sir, that is your balance but the available balance is -$411.31.
How is that?
You have pending items that haven't been paid yet.
Ok.., but if all of the items were paid the account would only be $3.33 overdrawn. Why was I charged $419.64 in overdraft fees?
Well sir, your account went into overdraft status with the pending transactions.
Yes but only with one
Let me explain sir. When the account went into overdraft status the pending transactions are still needing to be paid. You were charged an overdraft fee for those transactions.
Let me get this straight. Even though only a single transaction caused the account to go into overdraft since there are 12 other items in pending, some of which have been there for what looks like 10 days or more, I get charged an overdraft fee for all of the items and not just the one that put the account into overdraft?
That's correct sir.
How can you do that?
As part of the convenience of having the courtesy overdraft protection we charge overdraft fees on all items in a pending status anytime the account dips to a zero balance or below. Is there anything else I can help you with today?
No.., oddly enough you've been of great help.
Thank you for.
I hung up.
End phone call
"As part of the convenience of having the courtesy overdraft protection we charge overdraft fees on all items in a pending status anytime the account dips to a zero balance or below."
Is this how congress has helped the American public? By opening the door for banks to prey on their customers in ways they haven't been able to or hadn't thought of in the past?
I ask that you take a stand. Prohibit banks from legally robbing their customers by charging fees on items that dont put an account into overdraft. Force them to operate as honorable institutions that rely on their customers for their success and not blatantly take advantage of them for profit.
Keep in mind that there's a very real possibility that your bank is doing the exact same thing. And wouldn't it be embarrassing to find out that the very bank (s) that our elected officials use, the same elected officials that produced the bill that addressed excessive bank fees, were participating in this predatory business practice.
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