Why is my direct deposit suddenly not working?
May 12, 2007 7:52 AM   Subscribe

Suddenly, my normally working direct deposit isn't working, I didn't realize it and now I've wracked up many overdraft charges. How can I fix this?

My paycheck is set up to be electronically deposited into two accounts, at two different banks. The split is about 90/10, one bank for bills, the other for spending money. The money is usually deposited early Friday morning, and available for use. I get a printed stub from work saying XX amount has been deposited, delivered in a sealed envelope, like a paycheck.

This has been working fine for three months, until yesterday. Only one bank account had money deposited. For the remainder, I was issued a check.

Naturally, it was busy at work, and I just assumed money had been deposited to both and of course used my debit card on the one that hadn't been directly deposited. Today, I actually check my account and see that I've been hit with 3 overdraft charges for spending money that wasn't there. Had the money been deposited as usual, those charges would not be there. I open up the envelope and see that it's an actual check, not a deposit notice (though it does note one deposit did go through). There is also an important notice that says "Your bank was notiied of your request for direct deposit. It will begin after account verification." WTF? I requested no such thing recently and this direct deposit has been working just fine for

What's going on? How could this have happend? Is this the bank's fault or my work's fault? How do I go about getting these charges off and my money returned?
posted by The Behatted Wild Man of Greenfield to Work & Money (13 answers total)
Is this the bank's fault or my work's fault?

That's the key to the other questions and you have to start by asking the people who do the payroll at work about what happened.
posted by winston at 8:00 AM on May 12, 2007

I've accidentally overdrawn before, just not realizing I did it. Call up the bank, ask them about it. Be really nice and tell them about the direct deposit flub at work, and they just might not charge you some or all of the fees, depending on whether or not you've done it before. I had 3 overdrafts of like $35 total, and got hit with $120 in fees from PNC, I did the above, and they took away all of it.
posted by Mach5 at 9:06 AM on May 12, 2007

Seconding Mach5: if you've been a good customer, your bank is likely to either reduce all the charges or reduce them to a single charge. We had a similar mistake when somebody in the family mis-remembered which account paypal was withdrawing from. We ended up getting hit with 6 or 7 $20 fees for transactions of $1.98 and $2.07 and similar amounts, all made within a few hours of each other. When I called the bank, I said that this group of charges stemmed from essentially a single mistake, and they reduced the charges to one $20 fee, which I thought was fair since we did screw up. Since this wasn't your screw-up, your bank may be willing to drop all the fees for you this one time.

Talk to your payroll office and find out what's up from their end. If somebody there screwed up, they might be wiling to pay any fees your bank won't waive.
posted by not that girl at 9:30 AM on May 12, 2007

I've been having a lot of problems with my direct deposit recently too! To resolve the issue, I've asked payroll at work to give me the numbers (account and routing) they have been using, as well as any correspondence from our payroll company stating why the transaction didn't go through. Then I've called the bank to verify that this information is correct and ask them about the reason the payroll company gave me. The bank should be able to tell you exactly why it stopped working.

The first time, someone at my bank messed up and denied the request for the transaction. The second time, it turned out that the payroll company messed up - there are codes that identify accounts as 'checking' or 'savings'. The payroll company was using the wrong code for my accounts. It was just a clerical error on their part.

You should also speak with someone in your payroll department - they would have known that something went wrong and you were getting a paper check this time. Why didn't they say anything to you?

Once you've determined what happened - someone made a mistake somewhere if it's been working until now - call the bank and work with them. Be nice and ask if the charges can be reversed. The good thing about this is once the account and routing numbers are submitted, you have no control over it, so you know it's not your fault.
posted by youngergirl44 at 9:40 AM on May 12, 2007

nthing calling the bank and explaining your predicament. If you haven't done this before (at least not in the past year), they will refund 50% of the fees (at the very least). Be polite on the phone when you call. After this is sorted out, go down to payroll and have a talk with them (also politely).

now go do something fun to cheer yourself up.
posted by special-k at 11:01 AM on May 12, 2007

When this happened to me a few years back, my bank refused to reverse the charges at all - I shouldn't have made withdrawals without verifying that the money existed, blah, blah, thank you drive through.

I've got a new bank now.

You may have to put up something of a fight - most banks in my experience tend to adhere to the Ferengi rule of trade :"One you have their money, NEVER give it back"
posted by Pogo_Fuzzybutt at 11:21 AM on May 12, 2007

Talk to your payroll department. If there was a note that direct deposit was pending, then they probably did something (accidentally) to cancel your direct deposit. Maybe they were updating software or training someone new.

When I did payroll for my company, we did have at least one occasion where we refunded an employee for overdraft charges because of an error we had made.

Also, if there was a new direct deposit request put in, for whatever reason, it usually takes two weeks to go through. So if you're paid weekly, this Friday's check will probably be a live check as well.
posted by saffry at 11:51 AM on May 12, 2007

IAAPayroll Supervisor. The problem could either be in your company's payroll department or at the bank. Any changes made to the transit or account numbers on your direct deposit in the company's payroll system would send that portion into a pre-note process. This process tests the transit and account numbers to validate them prior to sending the actual direct deposit. If there are no issues in this test, your check should be direct deposited in the next payroll run. Your payroll department could have caused this process to run, or there could have been an error at the bank that stopped your deposit.

You could call the bank to see what they say, but I think you'd resolve the issue more quickly by contacting your payroll department. Ask them to explain why your previously functioning direct deposit has failed, and advise them of the overdraft fees you've been assessed as a result.

You may also want to look at the direct deposit form you submitted to your payroll department, assuming that you kept a copy. The one my company uses makes it clear that it is the employee's responsibility to verify that funds have been deposited in their account. If it was the company's fault, you may still be able to have your overdraft fees refunded, even if the form contains this language. There's no harm in trying.
posted by contrariwise at 1:15 PM on May 12, 2007

What they all said except: don't call the bank! It will be much easier for you if you take the time and walk into a branch and ask for someone. You will sit in their office and be a real person with a real problem and they will generally care a lot more about you. Just be nice, the overdraft charges will be gone.
posted by kuujjuarapik at 3:27 PM on May 12, 2007 [1 favorite]

It will be much easier for you if you take the time and walk into a branch and ask for someone. You will sit in their office and be a real person with a real problem and they will generally care a lot more about you.

Yes, definitely. This is a good opportunity to build a relationship with the people at your local branch. If you are friendly with them, they will be much more likely to help you with all sorts of problems in the future. Also, realize that the people at your branch (up to and including the manager) may simply not have the authority to remove these charges, so don't get pissy, even if they can't help you this time.
posted by Rock Steady at 5:47 PM on May 12, 2007

If you go in person to your bank branch, I have learned one invaluable piece of advice: dress up. Maybe not to job-interview standards, but don't go in t-shirt and jeans. Be very measured, very much I-don't-know-how-this-could-have-happened-but.
posted by dhartung at 10:07 PM on May 12, 2007

This happened to a girl at my workplace once. All it took was a call to our payroll specialist, and a quick form to fill out. Her overdraft charges were paid for by the company, and her full check was reimbursed since it was never deposited. Yay!

If it's not your workplace's fault, I agree with all the above advice in re: the bank.
posted by Verdandi at 7:01 AM on May 13, 2007

It was work's fault. They've cheerfully paid for the overdraft charges and offered to write letters if the overdrafts caused problems.
posted by The Behatted Wild Man of Greenfield at 10:14 AM on May 19, 2007

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