What can we do about all these overdraft fees, which we think are unjustifiable?
July 24, 2009 5:51 PM   Subscribe

My girlfriend received $506 in fees for overdrafting about $40 from Bank of America. Is there anything we can do about this?

Here's her question, since she doesn't have an AskMefi account:

Hey Everyone, I urgently need guidance on how to deal with some outrageous banking fees.

I have a checking account with Bank of America. My card has a credit card function on it, which I used last week in order to purchase food. Meanwhile, I had not realized that the bank hadn't processed several of my other past charges - they decided to process all the charges at once, over-drafting me by $40 and slamming me with 5 $35 overdraft fees. Apparently (I just learned this tonight from a cold-voiced manager at a Customer Service center) it's the fault of the merchants, since they gave me a receipt, meaning the charges would be consider debit - NOT credit, even though each of the 9 charges were specified as credit. When I called on the 22nd, I learned that if I didn't pay what was originally $216 in fees, the total balance I owed would jump with 6 more incoming overdraft fees. Being a struggling college student, I couldn't just pay it all off and move on; the total balance is now $506 and are about to jump again. All of my attempts to escalate the problem via phone have failed, despite my threats to use legal and public action. I am also awaiting replies from emails I sent to CEO Ken Lewis, as well as several other executives - I am sending more emails tonight.

Is there anything else I can do? I really need help soon! I have a paycheck coming in next week that auto-deposits and, if I don't have a solution before next Friday, I will have MORE overdraft fees (as explained to me by a service rep) and I won't be able to cover a payment to my University, which was a strict agreement.

Please let me know what can be done. Thank you so much!!!
posted by GrooveStix to Work & Money (53 answers total) 8 users marked this as a favorite
Go to the bank itself, explain that you've been a good customer, and try and talk them into waiving all but the first couple of fees. I wouldn't waste another email on the CEO.
posted by craven_morhead at 5:57 PM on July 24, 2009 [1 favorite]

With your card having a credit card function, does that mean they can ring it up as a credit card or that it's essentially two cards in one?

If the latter, then I'd go to the merchants and figure out why they did this to you (assuming you're telling the truth and all of them were actually done on a credit card).

Send the story to consumerist.com and watch the hilarity ensue from that. Local news outlets might not be a bad option either, especially if it's local merchants who helped cause the problem.

All of this advice by the way comes with the disclaimer that I'm not anywhere close to a financial/working with money or banks person and that it's a lot easier to just [not] buy stuff you can't afford.
posted by theichibun at 6:07 PM on July 24, 2009

I had a problem like that once - money that was supposed to be in my account wasn't, I made four very small purchases on my debit card, racked up $100 in charges. I went to my local branch, explained what had happened and how I had never ever had a problem before, and they reversed the charges for me.

They did, however, give me a very stern finger shaking about how the next time I would be up shit's creek. If it helps, that was with Bank of America.

good luck!
posted by firei at 6:17 PM on July 24, 2009 [1 favorite]

If you can't get any action at the local level, you may have luck contacting Bank of America Executive Customer Relations.
posted by i love cheese at 6:17 PM on July 24, 2009

sounds like she has a debit card with a Visa logo that merchants can process as either a credit or debit card. If the merchant processes as a credit card, it still winds up being taken directly from your checking account just a couple of days later as the charge goes through Visa before BOA.

I second going to the brick and mortar and asking for them to waive some of the fees.
posted by busboy789 at 6:20 PM on July 24, 2009

Go to your bank branch and talk to the manager. Be all "How can this be?" and "I can't believe this is happening, I'm a good person, college student, just $40." Also: "I reached out to an online forum and described what Bank of America seemed to be doing to me, and all these people wrote back immediately and said Bank of America wouldn't do that to you, it's a mistake."

The bank manager, and the person above the cold-voiced person on the phone, have the authority to waive these fees. "I'm a good customer, this was a tiny screw-up, and these fees are absurd" is a good argument. "Tons of people online wrote back and said this couldn't be true" is a good veiled threat. Try as hard as you can not to play the final card prematurely: "Thousands of friends and strangers are about to hear about this Bank of America screwup." Get the manager to hear this sentence in her head without you actually saying it.
posted by gum at 6:20 PM on July 24, 2009 [3 favorites]

Unless your bank card is supposed to double as an actual credit card rather than simply being a debit card that has a MasterCard/Visa logo on it to allow credit transactions, the onus is on you to balance your plastic checkbook. Using a debit card for 'credit' is in most cases the exact same as using it as 'debit' as far as your bank is concerned -- the money comes out right away.

You can and should still go to a local branch, explain the situation, point out if you've been a good customer with no problems like this and ask for them to remove some or all of the fees. But if you've overdrafted at all in the recent past, don't expect them to be lenient about this.
posted by asciident at 6:21 PM on July 24, 2009 [2 favorites]

Your girlfriend has a Visa debit card that is linked to her checking account. Merchants will often ask, "debit or credit," and the only difference that question makes is whether she signs the receipt (credit) or if she will enter her pin number (debit). This does not change the origin of the funds...when she uses her card, the money is withdrawn from her checking account. Thus, unfortunately the charges she made caused the overdraft of the checking account, not a bank error (based on the account that is written above).

Now, as far as what she can do about it...the best option is to go into her own banking center location and speak to a customer service manager regarding the possibility of reversing a portion of her overdraft fees. I would recommend being polite, and taking responsibility for the charges, rather than blaming the bank, more flys with honey than vinegar principle in action. They will assess her customer profile, determine if she's had many NSF (non-sufficient funds) days in the past year, and if she has had any fees reversed previously.

Secondly, she should set up overdraft protection of her account, by funding a savings account which will auto-transfer if shes tries to use her card and depletes her checking account. Most importantly, she should begin (as in, now) to keep a ledger via checkbook or online (Quicken, Money, etc.) that tells her how much she has in her account before she uses her card and overdrafts.
posted by Asherah at 6:21 PM on July 24, 2009 [8 favorites]

"Thousands of friends and strangers are about to hear about this Bank of America screwup."

Bank of American doesn't care about threats such as this anyway...speaking as someone who received them across a bank counter for six years as a former BofA employee (not saying I didn't care, but The Corporation doesn't.) I wouldn't even recommend anyone wasting their time on this, as it is clear that in most cases, overdrafting is caused by consumer error (as it seems to be described above).

As an aside, if you don't like the fee structure of your bank (e.g. overdraft fees, late charges, account fees) get a new bank, or better yet, a credit union.
posted by Asherah at 6:28 PM on July 24, 2009 [5 favorites]

First, get in touch with your university, explain what has happened and beg for some leniency on your payment to them. If they say no, try and find your university's student advocate (here in Australia it would be the student union, or you could contact the deans office, but I'm not sure about where you are) and appeal the decision. This is not your fault at all and you shouldn't be penalised for it. Document this process - names of people you spoke to, times, dates etc in case something goes wrong and the payment does go through after they have (hopefully) agreed to delay it until you can sort everything out.

Then write down every contact you have with the bank too - names, times, dates, ask for reference numbers for your calls and note those down too. You need a dossier.

Next try these numbers from Consumerist. Explain your situation and state that you absolutely dispute the original and subsequent fees and that you expect your bank to do everything it can to rectify the situation in your favour or you will be taking legal action, writing to your congressman and contacting the press. Do not stray from the position that this is absolutely unacceptable. Because it IS unacceptable. Document those calls similarly.

There is every chance you will get absolutely nowhere. At this point, you need follow through and write to your congressman, at least. If your state has any kind of free legal aid (perhaps your university has a legal clinic attached to a law school?) find out what your legal rights are.

Also, I would really consider taking your dossier to your local newspaper, radio and TV stations. I can't guarantee their interest, but when I was working at a newspaper, this is the sort of story that I would've been falling over myself to follow up - poor college student slugged with massive fees by evil bank and screwed over and over again. You may have best luck contacting a newspaper on a Sunday when reporters will be scrabbling for stories for Monday. Again, I can't promise this will fix it, but corporations can be remarkably eager to avoid bad publicity and a reporter calling and asking ''Is it true that you charged this person $x and refused, multiple times, to address the issue caused by your bank'' could have quite the galvanising effect.

You may also want to consider leveraging social media - twitter vociferously about this. If Bank of America monitor Twitter for mentions of their brand you may have success in embarrassing them into taking action. When you do this, absolutely do not be abusive or personal, stick to the facts.

I'm so sorry this has happened to you and even sorrier that I can't think of some magic formula that will fix it immediately. I hope somebody else has a quick fix for you. Banks can seriously suck.
posted by t0astie at 6:30 PM on July 24, 2009

Oh! And come to that, why not get in touch with Consumerist? Re people saying this is your fault, yes, you should have balanced your plastic chequebook. But $500 and climbing is absurd, unethical and utterly unacceptable.
posted by t0astie at 6:34 PM on July 24, 2009

"This is not your fault at all and you shouldn't be penalised for it."

The overdraft IS her fault.
posted by busboy789 at 6:38 PM on July 24, 2009 [1 favorite]

First off all, get away from the credit vs. debit distinction. That means something in some cases, but probably not here.

Here's what I guess has happened, as it's happened to me before with my own BoA debit card:

You go around town buying coffee, drinks, dinner, whatever using your debit card. You don't keep up with what you've spent, but you do check your balance online or at an ATM. This shows your "pending balance" - generally a good estimate of what charges you've racked up. Only, if the merchant hasn't run his nightly batch job in a few days then your card hasn't been hit yet. So you keep spending, having forgotten the six rounds of drinks you bought the night before at three different bars. Those charges aren't processed until Sunday, when Stewy the daytime manager realizes that the lazy assholes from the Friday and Saturday shift haven't run their batch jobs.

Kapow. You're hit with charges that you didn't you see coming because your memory is fuzzy and you didn't keep, or didn't go through your receipts.

Let's say you have $100 in your checking account. And you've spent $90. You have, counting all the pending charges $10. Whew. Good thing payday is coming up. Only once Stewy runs his batch job, you're overdrawn.

Now here's the maddening bit: If Stewy hits your card one time for $60, that means you've drawn by $50. The bank pays Stewy, and assess you an overdraft few of $35. Ouch. You're in the whole now $85. That sucks.

But lets say you kept going up to the bar and running your card for drinks each time and closing it out. You do this three times, $20 bucks each time. Stewy runs his batch and suddenly you're overdrawn by $60, but you're hit for each transaction. Three x $35 = $105 plus the $60 you owe, means you're $165 in the whole.

Do you see how the system works now? You've overdrawn by the same amount in each case, but because the bank assesses fees by transaction, not overall amount, you got royally screwed in the second example.

Here's another way they get you: Let's say you have $500 in your checking account. It's the end of the month, and you write your rent check for $480. You forget though that earlier in the week you sent off renewal checks for your four favorite magazines of $10 each.

The bank processes all these checks at the same time. You've got your $480 rent check, and four $10 checks, but only $500 in your checking account. The bank processes the big check first. You then have $20 left. Then processes two of the $10 checks. You're at zero. Then the final two over draw you by $20 and you popped $35 times two, or $70. The bank could have paid the four small checks first. You would be overdraw by $20 and assessed a single $35 fee. In other-words, it's the bank purposefully tries to zero your account first, before processing smaller checks (or debit purchases.) This is so they can ding $35 bucks per transaction.

One last example of how BoA fucks you: Let's say you have an emergency. Car trouble that requires you to call tow truck. You pay with your debit card, only you know that you've got some pending charges and that this may put you over. No worries, you'll swing by the bank before 5pm and deposit a wad of cash to make up the difference and keep your balance positive. Only, it doesn't work that way. The bank processes your deposit last. You still overdraw, even if a pending deposit is there to replenish it. This can actually doom your deposit as the fees eat up what would have been your positive balance. Rinse and repeat as Stewy decides to run your card the same day.

Yeah it sucks. Yes it's predatory. Yes it should probably be illegal.

What can you do? Not much it turns out.

Here's the thing though: BoA knows they are fucking you, and sometimes you can find a bank managers type who feels bad about it.

Put on a suit, march into you local branch. And say, "This is crazy. I can't believe this is happening!" Cry if you think you can pull it off. If you've never had any problems like this before, then BoA may refund some of the fees. Alternatively, they may try to get you to apply for a BoA credit card, on the promise that they will take care of the fees - this time, The BoA credit card will then graciously link to your checking account so that when you overdraw, you'll be assessed a $10 fee instead of $35 fee.

BoA is truly a bunch of skull fucking assholes. Straighten out your account then move on to a local credit union asap.

Good luck.
posted by wfrgms at 6:39 PM on July 24, 2009 [15 favorites]

I hate to say this, but this just happened to us a few months ago, and they (Capitol One) wouldn't budge even an inch. They're just sitting around waiting for this to happen, steepling their fingers with sinister, self-satisfied grins. We left right away.
posted by umbú at 6:43 PM on July 24, 2009

I'll Nth the urging to go talk to someone. Whenever this had happened to me with Huntington, I'd call them up and would get most of the overdraft charges removed. Ashamed to say that I had this happen multiple times, but I believe each time I only ended up having to pay one overdraft charge.
posted by Phantomx at 6:49 PM on July 24, 2009

This is why you:

1- Use a credit card for all transactions.
2- Keep your own balance of the checking account, and don't rely on the bank's balance. THe bank doesn't know what charges are still "out there", it can only provide you with what's real *now*. Just a snapshot.
posted by gjc at 6:51 PM on July 24, 2009

I've had this happen before and the first time it happened I was able to get them to drop the overdraft charges. It was also setup so that if the card overdrafted, it would go straight to credit, rather then incurring a charge. My problem was that my card was at the limit at the time.

But yeah it's total B.S. This kind "each transaction = overdraft" stuff is totally outrageous and should be illegal. But it's not because the banks own congress. Lawmakers have actually proposed outlawing this stuff but it never goes anywhere. (There's still a chance it could be fixed in the upcoming financial consumer protection reform. Banks would have to justify their fees compared to the actual costs incurred.)
posted by delmoi at 6:55 PM on July 24, 2009

BoA is truly a bunch of skull fucking assholes. Straighten out your account then move on to a local credit union asap.

BoA isn't the only bank that does this. According to Wikipedia banks picked up about $33 billion overdraft fees '03.
posted by delmoi at 7:02 PM on July 24, 2009

I assume your gf is a college student? Most universities have some sort of emergency loan program that gives you $500 or $1000 in short-term money, usually payable at the end of the term. Have her do this, then go into a B of A branch and talk to the manager. Try to negotiate the fees down to something more reasonable ($100?) I know it would suck to even have to pay $100 or $200 when she feels she didn't do anything wrong and it was a merchant error. But if B of A correctly followed their procedures, then any sort of settlement is a lot better than $500 and climbing in fees.

If I remember right, we had an AskMe a few months ago about a user who had accumulated at least $5,000 in debt from one pesky service charge that she allowed to get out of control and that multiplied many, many times over. Don't be that person.
posted by Happydaz at 7:04 PM on July 24, 2009

Whether or not it's BS is not really up for grabs - the account was opened, the terms were agreed on, and now this is the creek you're up. It's times like these that I thank SKY FAIRY that I am OUT of the finance biz FOREVER.


1) Since you can, go into a branch in person.
2) Do not yell, become angrily hysterical, or be on about emails you've sent to the CEO.
3) If you have a good history with BoA otherwise, plead that, very nicely.
4) If you can cry without it becoming a straight-up mess or actually freaking out, some tears probably wouldn't hurt.
5) Hopefully they will reverse some of the fees for you. Keep in mind how many fees they can refund will be based on their level of authority, and I have no idea what dollar amount a branch manager or any assorted underlings at BoA can or will reverse. Expect three to four reversals at most, be happily surprised if it's something more.
6) Get your stuff straight with BoA, shut down any automatic transfers, charges, etc.
7) Open an account at a credit union. At least consider it, particularly if you are going to stay where you are, you are about to graduate, or if your parents have access to a credit union or USAA. Don't stick with Beast of America unless you have to. They are ubiquitous, but they suck.
8) Manage your checkbook with a ferocity. When you have little money, it's even more important. I know it is HARD to look at your bank balance when you're broke but do it anyway.

Good luck. These are not fun conversations to have, from your side or from the bank employee's side.

On preview: generally speaking, and this is my experience not at BoA but at another bank, they are not going to "negotiate the fees down." Whomever helps you will have the ability/authority to reverse so many of the charges, probably not all of them.
posted by Medieval Maven at 7:08 PM on July 24, 2009 [2 favorites]

Also, slightly tangential, but I made $70 by opening up an account at B of A for me and my wife. (Deposit incentives for depositing $100) The bank just sent us notice that they're charging a monthly fee starting in August, so now it's time to find a new secondary bank that will pay me to open an account (my primary account is with a credit union.) I recommend she finds a new bank once this is all over, preferably one that will pay her to make her first deposit.
posted by Happydaz at 7:08 PM on July 24, 2009

Whether or not it's BS is not really up for grabs - the account was opened, the terms were agreed on, and now this is the creek you're up. It's times like these that I thank SKY FAIRY that I am OUT of the finance biz FOREVER.

Hey, just like payday lending! They agreed to the 10 page 4-point fine print contract, obviously their failure to memorize it allows the bank to just charge whatever they want whenever they want.

Obviously if people agree to a contract with a clause that terms can be changed, any contract changes are totally reasonable. (and by the way, even if the overdraft fees are in the contract, I doubt the fact that they will charge you for each infraction, and order the checks to optimize the level of screwed their customers get)
posted by delmoi at 7:26 PM on July 24, 2009

Response by poster: Hey everyone, I deeply thank you for the outpouring of help/advice on this matter. You are all amazing! Thank you!

@theichibun, it can be rung up as a credit card. And unfortunately, while *normally*
I never borrow - I don't even have an official credit card - I was pretty hungry...I'm in University and just getting by after paying off rent, bills, etc. If you've ever lived on between $40-60 for a few weeks, let me know and we can share experiences :)

@Ilovecheese - I'll try Executive Customer Relations, thanks for the link! Emailing Ken Lewis has clearly done nothing for me as of yet.

@gum: I'm mobilizing a Facebook group as we speak. If this isn't solved by the next 2 business days, I'm going start reaching out to local reporting. That was a great suggestion, thank you :)

@asciident, I have overdrafted in the past by pennies (I forgot the tax rate for the state I was in)...I hope this will not affect their willingness to help.

@asherah - I anticipated corporate apathy, but I've also worked with them in the past, in a way that makes my stance a little harder to turn down. If Bank of America is all about philanthropy, at the least it should take notice when one of its Student Ambassadors is being screwed over by a cold policy.

@t0astie - GREAT IDEA! I'm definitely mobilizing people right now, and I think this is going to garner enough attention for something to be done. I think my University will understand (thankfully) - it's the bank that I worry the most about. Tuition agreements aren't as scary as burgeoning overdraft fees...:/

@busboy789 - I definitely acknowledge that the overdraft is my fault - however, what I'm currently facing IS, as t0astie said, unethical and absurd. I would have kept silent at one or two overdraft fees....but it's over 11 now.

@wfrgms: Actually, these all happened within the course of under 3 days. I made small food purchases since going to a supermarket would have just tempted me to buy more (never go there on an empty stomach...). The charges just moved way too swiftly for me to catch right away.

@Phantomx, could you possibly elaborate on how you dealt with your bank please?

@Happydaz - yep, I'm a University student and no, there's unfortunately no emergency loan of that size. I'm definitely not going to let this slide - I'm fighting every day to get this removed.
posted by GrooveStix at 7:31 PM on July 24, 2009

BoA is truly a bunch of skull fucking assholes.

I could not possibly agree with this more. My life has been a lot better since I ditched BoA.

All the best of luck to you in calling public attention to these outrageous charges--you can't imagine how much I hope you succeed--but be prepared for Bank of America to be all "meh, sucks to be you."

If Bank of America is all about philanthropy

Yeah, they really, really aren't.
posted by corey flood at 7:44 PM on July 24, 2009 [1 favorite]

@asherah - I anticipated corporate apathy, but I've also worked with them in the past, in a way that makes my stance a little harder to turn down. If Bank of America is all about philanthropy, at the least it should take notice when one of its Student Ambassadors is being screwed over by a cold policy.

Please feel free to update if you encounter a resolution that you feel is fair. I believe most of the responses here noted a similiar tone, in that, you may receive some charges reversed, but it is not very likely that you will get a full reversal. I would also sincerely encourage you to balance your checkbook, because the simple fact is you used your card for more money than you had. When you opened your account, you received a fee schedule indicating how much an overdraft charge would be, per incident. These are the account terms and anyone who opens an account has them. If you do not agree to these fees, it is within your right to close your account and take your business elsewhere (credit unions work well, your school probably has one associated with it.)

Google "overdraft fees" and you'll see that financial institutions are increasing their per charge fees to recoup credit card finances charges in preparation for restrictive credit card APR legislation that will take effect in 2010.
posted by Asherah at 7:45 PM on July 24, 2009

This happened to me with B of A. They were completely unhelpful. I joined a credit union that had overdraft protection and hardly any fees and never looked back.
posted by oneirodynia at 8:39 PM on July 24, 2009

Yup. BofA is horrible about reversing charges.

Since I haven't had any decent income coming in, I froze my zero-balance BofA account by calling and talking with a representative. BofA subsequently allowed five transactions to go through on the account - racking up $140 in fees. BofA assessed another "unpaid fees fee" of $35. I didn't receive any notice until I deposited a paycheck (first one of the year!) and got slapped with the negative balance. Since then, I've been disputing the fees but everyone I've talked to has just shrugged and said, "Sucks to be you." (Okay, not so bluntly).

Good luck, but don't expect anything from BofA. I'm switching banks tomorrow.
posted by LOLAttorney2009 at 9:01 PM on July 24, 2009

I'm sure credit unions charge fees too.

All I can say is be nice to the people at the bank itself. They have no control over policy, but they do have discretion over what to do.

What I would do is start with "hey, just want to get this straightened out." It is possible that all they *really* want is for the account to not have a negative balance.

If they don't give you any relief, I would say "OK, here's the $40 I overdrafted, and here's $35 dollars for one overdraft charge. Close my account and send the rest to collections." And see what happens.
posted by gjc at 9:05 PM on July 24, 2009 [2 favorites]

Something like this happened to me with a bank once, they wouldn't listen to reason and there wasn't any money in the account anyway (hence, overdraft) so I just abandoned the account and decided to let them come after me for their idiotic fees if they wanted. That was 5 years ago, and I get some snotty letter from a collection agency maybe once every few months, and it's probably been a slight credit hit, but there haven't been any other consequences, I've been able to open other bank accounts, etc.

I don't recommend this course of action, you really have to be extremely irritable and stubborn or have financial/legal balls of titanium, and it could go down nastier than it did with me... but it's an option.
posted by paultopia at 9:17 PM on July 24, 2009

(What I would do RIGHT NOW is contact your employer and put a stop to the auto-deposit. They WILL just hoover that money right out of your check if you put it in there, and any leverage you have is gone.)
posted by paultopia at 9:18 PM on July 24, 2009 [3 favorites]

When I called my bank I was pretty upset because I didn't understand the order in which they charge things. Specifically the 'big ticket' items because those are the ones that are more likely to hurt your credit. (this was explained by the person I was talking to) I pleaded with them that this is an outdated system because of debit/psuedo-credit cards. Since they get used everywhere, in the course of a day I buy two meals and something at a store and maybe some gas, and before I get home to discover that I had misjudged and overdrafted by maybe ten dollars. (I know my own fault, but it's the process that I'm arguing against) If they charged the small stuff first then the big stuff then it's only one overdraft, but the way they do it it is maybe three overdrafts.

I mainly showed frustration at the bank's system and confusion at how they could fleece their own customers for so much money when things are at their worst. These things just tend to pile on top of each other.

Each time I was dealing with the very first person I got connected to. I communicated my anger without yelling at the person. After all, whoever you are talking to is not the actual person that put those charges on your account, but they could be the one to remove them.

I also never tried to get them to remove all of the charges, because I was the one that screwed up when it comes down to it. My problems were with the process of multiple charges, not the actual overdraft fee itself.
posted by Phantomx at 9:33 PM on July 24, 2009

I've had the same thing happen with Bank of America in the past. So have my mom and my aunt, and a friend.

You're pretty much fucked, sorry to say. We went through customer service and they refused to do anything about it.

Then we went to the Better Business Bureau; in our case, BoA had purposely posted the charges not in chronological order, but in the order that most maximized overdraft fees -- something they deny that they do. However, once our accounts went below $50 and stayed generally low for a couple months, in all our cases they then started holding transactions from posting even as pending for roughly a week. Then, BAM, they posted them all on one day, and in the order to maximize fees. If you keep your balance higher than that, pending stuff shows up immediately and nothing takes terribly long to post. When it happened to me I watched quite carefully, and then later when it happened to my mom, aunt, and friend they noticed the same thing. My mother had found an article about it in a newspaper in the past but I can't seem to find it now.

Anyway, BoA's answer to my going to the BBB was to remove a single overdraft fee. How generous; I was still stuck with $300 in overdraft fees. I told the BBB not to consider the issue resolved, but BoA took no further action.

By the way, both my mom and aunt had been good BoA customers for over a decade and pleaded their cases along those lines. BoA does not care; if they can ream you, they will.
posted by Nattie at 9:37 PM on July 24, 2009

I have had a pleasant 2 year experience with BofA.

I was expecting my pay to be direct deposited on Wed and charged something on my card, and the pay got deposited on Thursday. Just called up and told the rep I want to get the $35 or so waived - explained the payroll direct deposit etc and told them I have never made such a mistake earlier. They promptly reversed the charges.

If the rep doesnt work, try the manager as others have suggested.

Also, I know it can be difficult to have a cushion amount but in case you have some excess money one day, try to save say $50 which you decide not to ever use unless its really an emergency (need to absolutely pay some bill, need to eat, etc). You could try start with $10 and gradually increase that cushion as and when you lay your hands on more money.

Also, one more word of caution - don't get tricked into a secured credit card (where you put aside some money and that works as your credit limit). Its good to start building your credit - say charge the groceries you have the money to pay for, to a credit card and then pay it off immediately. MefiMail me if you are interested in trying to get a an unsecured credit card no-fee BofA credit card. (or if you need some info managing your bank a/cs while leading a student life - i just graduated but somehow had a very little banking mess than most of my friends on a student income)

Good luck :)
posted by bbyboi at 10:17 PM on July 24, 2009

I have had this happen, and I can tell you that branch managers in Southern California have the authority to reverse up to $125 of fees if you're a good customer who has not had an overdraft in the last year. If it's more than that or you've overdrafted recently, you will be absolutely out of luck trying to get a resolution over the phone or in person. The only option then is to go corporate and write the CEO, etc.

What I would beg for now is to stop the process of cascading fees. Ask if she can deposit the paycheck toward the negative balance and NOT the fees she already has, that way she stops incurring new fees.
posted by slow graffiti at 10:28 PM on July 24, 2009

A loved one who's bad enough with money that credit unions turn him away has racked up literally thousands of dollars in these overdraft fees from Wells Fargo over the past few years. All the megabanks do this, by the way. They tend to reverse the fees at first, but if you do this repeatedly, they won't.

I've used BofA for years with minimal trouble. But I keep a hawkish eye on my balances.
posted by grrarrgh00 at 10:42 PM on July 24, 2009

nthing the call to join a Credit union.
posted by lalochezia at 10:55 PM on July 24, 2009 [1 favorite]

And, by the way, yes. This should absolutely be illegal. And very recently, there's been quite a bit of momentum in Washington behind an idea that could help curb behavior like this on the part of banks.

Do a Google News search for "consumer financial protection". You'll find articles like this op-ed* from the NYTimes, stumping for the creation of a federal consumer financial protection agency that would regulate the financial products banks market to consumers, and how they work.

This is one of those quiet, wonkish issues that will get buried under a fog of lobbying unless actual people make actual phone calls to their legislators and explain that the CFPA is a really, really good idea. Do this. Enough regular folks are disgusted by these practices that we should be able to put an end to them. So even if the bank reverses your fees, make a call to your Senators and Representative. Everyone else who hates this stuff, do the same.

* The very first comment to that op-ed, by the way, might sound familiar:
A few years ago I worked in customer service for TCF bank which is based in Minneapolis. According to its annual report, TCF receives a large portion (about a third) of its revenue from customer fees. While working at TCF, I spent most of my time dealing with extremely irate customers who were complaining about excessive overdraft fees. For their customers’ “convenience,” TCF allows account holders to continue to use their checking account debit card even if their account balance is negative. But, of course, there is an overdraft charge of $35 for each transaction no matter how small the transction. I routinely saw customers with overdraft charges exceeding $500.

posted by grrarrgh00 at 10:58 PM on July 24, 2009

For the future, I recommend doing what I've done -- move your money to a credit union with a policy similar to the one I have (First Entertainment CU):

1. They will set up your checking account to pull from savings if you overdraft, at no charge;
2. They will only charge $3 for NSF if your savings account is empty, and it's per-day, NOT per-charge (so in your scenario you would have been charged a single $3 fee.)

This was a boon for my household, because we now have two levels of protection against overdraft, neither of which involve ridiculous fees. Honestly, it's as if the big banks want you to fail so that you can be charged high fees...oh, wait, that's exactly what it is.
posted by davejay at 11:35 PM on July 24, 2009

#1. Short term--absolutely top immediate priority is you have to get the fees paid now so that you don't have any more fees added. You could easily be in this another $500 or $1000 if you're not careful. Borrow or beg money from SOMEBODY--friend, family, church, whatever. But PAY THE FEES NOW and then work on asking for refunds.

DO NOT refuse to pay the fees in hopes that will get you out of the situation. It won't--it will just dig you in deeper.

#2. Medium term--move account to a more reasonable institution and consider it an important life lesson learned (and if it only costs you $500, a good deal at that).

#3. Long term--take the time & bother to write your senators & congressman about this. This is absolutely a ripoff and should be stopped, and the only chance of that happening is if people get mad enough to actually write their congress members about it.
posted by flug at 12:27 AM on July 25, 2009

@theichibun, it can be rung up as a credit card. And unfortunately, while *normally*
I never borrow - I don't even have an official credit card

This response is a bit confusing...it seems like you have a check card, and those don't have a line of credit attached.

I've had horrible bank fees. I have a tight budget too. And I suck at watching my bank balance. Quick solution is to take some cash out for the day, and spend that. An empty wallet is the only way I understand how much I'm spending.

Second paultopia's advice, stop that direct deposit. Your employer will be more likely to work with you so you can keep your pay...BoA will just eat that check.
posted by shinyshiny at 2:01 AM on July 25, 2009

All banks suck. It doesn't matter which bank, when it comes to this stuff.

You should keep more money in the bank than you are likely to spend, or spend less than you keep in the bank. What's hard about that?

And never use a credit-debit card. If that is stolen, you are so screwed.
posted by fourcheesemac at 4:30 AM on July 25, 2009

Get overdraft protection. And learn the difference between a Visa logo on a debit card and an actual credit card.
posted by Sweetie Darling at 5:00 AM on July 25, 2009

It seems like there is some confusion as well about debit versus credit when you use your bank card that is attached to your checking account. I just want to echo someone up-thread - it absolutely, positively, does NOT matter how those charges are processed. You have to act like that money is coming out of your account RIGHT NOW. I don't know how BoA's online banking works - I would assume they don't display pending charges in a way that makes sense, as, regrettably, nearly no one does - but just please, forget any mental distinction you've made between these two things when it comes to using your bank card. It's basically choosing whether to sign the receipt or enter your PIN, that's all.

@delmoi - I simply say that it's neither here nor there at this point. Telling her that the man has done her a wrong is fine and good and quite possibly accurate, but does not solve her problem.
posted by Medieval Maven at 5:10 AM on July 25, 2009


1- Use a credit card for all transactions. (or better yet, cash which you withdraw ONCE A WEEK AND THEN STOP SPENDING WHEN IT RUNS OUT)
2- Keep your own balance of the checking account, and don't rely on the bank's balance. THe bank doesn't know what charges are still "out there", it can only provide you with what's real *now*. Just a snapshot.

this this this this this!!!!! someone please tell my daughter
posted by nax at 5:21 AM on July 25, 2009

OP, have you actually physically gone to the bank yet? I used to be a bank teller and we reversed overdraft fees as a courtesy all the time, but only if the person came in to ask in person. That's really all I have to add to the discussion, but I think it deserves emphasis.
posted by telegraph at 6:38 AM on July 25, 2009 [1 favorite]

My bank shows me pending charges on my debit card when I log in to online banking within hours, even if the charges don't clear the account for a day or more.

But I'm sorry, all the advice here about making this a consumer crusade against BoA is absurd. Write the CEO?? Cry to the bank manager? Report them to BBB? All of it is silly, hysterical advice.

You spent more than you had. The fault is yours.
posted by fourcheesemac at 7:40 AM on July 25, 2009 [5 favorites]

If they don't give you any relief, I would say "OK, here's the $40 I overdrafted, and here's $35 dollars for one overdraft charge. Close my account and send the rest to collections." And see what happens.

I strongly recommend that you not do this. Your account will end up in Chexsystems' database and you could find yourself unable to open a checking or savings account at any other bank or credit union. That is, of course, in addition to the hit you would take to your credit reports.
posted by Juffo-Wup at 8:43 AM on July 25, 2009

Good luck with the emails, begging in person, etc., but don't get your hopes up too high. I'm sure BofA weathers a veritable shitstorm of email, online activism, etc., and your plight is unlikely to stand out. You're probably going to have to figure out a way to eat some or all of these charges. Then, as several other posters have suggested, you should find another bank, or ideally a credit union.

It sounds to me like you've misunderstood what kind of account you have with BofA. You've got a checking account, and you've got a debit card with a Visa or MC logo. You don't have a credit account. That your card "has a credit card function" only means that a merchant can use the electronic networks operated by the credit card companies (Visa or MC) to process a debit transaction against your checking account. Nobody is extending you any credit, and you should assume that these charges will be applied to your account instantly (though for various reasons they may be delayed for a few days).

It's your responsibility to understand how your bank account works, and it's your responsibility to keep track of the money you're spending and the money you have.

If Bank of America is all about philanthropy

Really, don't fall for this. Bank of America is all about making money for its shareholders. Like most of corporate America, BofA is so focused on short-term profits that the quality of any products or services it offers is just a happy accident.

Actually, these [11 transactions] happened within the course of under 3 days. I made small food purchases since going to a supermarket would have just tempted me to buy more (never go there on an empty stomach...).

Wow, that sounds like a lot of transactions. Slightly off-topic, but if you'd just used cash you might not be in as deep a hole right now. The ATM machine won't give you cash that you don't have, and probably would give you a better view of your financial situation. And, even further off topic, buying food at a supermarket is generally more economically efficient than buying it anywhere else.
posted by sriracha at 9:24 AM on July 25, 2009

Get overdraft protection.

Be very careful with this. Overdraft protection is essentially a line of credit attached to your checking account. It's important that you understand the interest rate and all of the fees associated with this line of credit before you use it.

In the past I've had overdraft protection on my checking account only to find that there was a $35 fee each month that the line of credit was used, in addition to the finance charges based on the interest rate.
posted by sriracha at 9:40 AM on July 25, 2009

I work at a bank. Most banks have the same fee structure for overdrafts. Honestly, I feel for you, I have been in the exact same situation. Here's the thing: You don't have a fortune in money market accounts and certificates of deposit at Bank of America. You live paycheck-to-paycheck. They don't care about you as a customer.

If you go into the bank and talk to a manager, you might be able to get some of the fees reversed. The fact that you have overdrafted before will not help. The amount of pity you get depends on the person you talk to. I wish you luck on this.

Once you've paid them off, close out your BofA account. Get to a local, small credit union.

Your debit card is not a credit card, I don't care how they run it. Get a credit card. They're not as scary as you may think. Only spend the money you've got, and if you go over a few dollars, you're not completely screwed. You'll never have to overdraft again.
posted by buriednexttoyou at 10:00 AM on July 25, 2009

Just to emphasize: stop using your debit card - for anything. Switch to credit cards. If your debit card is lost, stolen, or hacked - and the odds of this happening rise exponentially if you are out there using it - your bank account will get wiped out. If your cc is list, stolen or hacked - nothing happens, you can resolve it in your sweet time. Meanwhile, even if you eventually get your money back from a debit card debacle, you are living without the money. For a credit card, you don't have this problem. There is absolutely no reason to use a debit card, and every reason to not use it. My debit card stays in my drawer at home. Never leave home with it.
posted by VikingSword at 11:06 AM on July 25, 2009

I would do everything mentioned in this thread, but also consider filing a report with the BBB. You can do it online (it will only take a few minutes) and perhaps the best part about it is that the bank has to respond if they want to keep their standing with the BBB. There are no guarantees that they'll refund the fees but from personal experience, I've been at an impasse with companies before where I've escalated the situation as far as it can go up the phone chain and had more or less given up, but after I contacted the BBB the company actually backed down and refunded my money.

Document everything - ask for everyone's name that you talk to. If someone promises to reverse charges, get proof that they're actually doing it.
posted by bertrandom at 12:16 PM on July 25, 2009

You seem pretty naive about banks and checking accounts. Most, if not all banks do this exact same thing not just BOA. An attempt at a media storm will likely get you laughed at by whomever you contact at the TV station/newspaper with a "Welcome to grownup-land kiddo."

Unfortunately most of us have had to learn this lesson the hard way ever since debit cards were invented (I get a little reminder every now and then). At least most credit unions with overdraft protection will pay the charge instead of bouncing it, sending it back through the system for another round of charges, and charge a smaller NSF fee. I read somewhere the other day that the average American pays somewhere around $275 in overdraft fees a year.
posted by tamitang at 1:50 PM on July 25, 2009

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