Chase's overdraft fee scam ( now resolved but interesting discussion )

[Beamhead]

Re: Chase's overdraft fee scam

Glad to hear it is not as bad as you thought, I had to set my Father up with Quicken when he was ailing but quickly learned it was easier for me to just have him make sure he entered every transaction in a register then I would enter that into Quicken and reconcile it every month.

I have Qdata going back to 1994 and its scary to see what one has spent over the years. :tinfoil: Prior to that I did the reconciling the old fashioned way each and every month, guess I am a tad AR when it comes to money.

Hope your Mom is feeling better now.

 

[jtr1962]

Re: Chase's overdraft fee scam

Do you not have Debit Cards over there? My Visa is a debit card that comes with my bank account. The funds come directly from my bank account. Having said that, I also have a Matercard credit card that I also use though I pay it off every month. So far I haven't come across anything that I can't pay with either. Pretty much everyone who has a bank account gets a debit card with it.

Yes, we have debit cards. I have one. I never use it because it debits my checking account, not my savings account. I only add enough to my checking account each month to cover whatever bills I'm paying ( generally my CC if I have a balance and my student loan ). I can't be bothered to keep track of small purchases so as to make sure my checking account remains in the black while I'm using my debit card. And I'm not going to keep a large amount in my checking account as it's non-interest bearing ( not that my savings account is much better these days ). Easier just to take out $20 or $40 cash from savings via the ATM whenever my money runs low.

Debit cards are exactly the one big way people in this country have gotten into trouble with overdraft fees. Almost nobody is going to bother keeping a ledger of the small purchases they use their debit cards for. End result is a lot of people end up with buying things without enough in their account to cover it. In the past this just resulted in the debit card being declined due to insufficient funds. Now the banks cover the shortage, and impose hefty fees. No thanks, I'll stick to cash. It's pretty obvious when I'm running low, and the ATM is a few blocks from most of the stores I use cash in.

What we really need is some sort of electronic currency which works like a debit card, but has a real-time balance remaining displayed right on the card. Same as cash, and with no banks or fees involved. I really don't like carrying cash ( don't get me started on pennies ), but for some things at this point in time nothing beats the user-friendliness or convenience.

 

[jtr1962]

Re: Chase's overdraft fee scam

Glad to hear it is not as bad as you thought, I had to set my Father up with Quicken when he was ailing but quickly learned it was easier for me to just have him make sure he entered every transaction in a register then I would enter that into Quicken and reconcile it every month.

I'll probably do something similar. I'll just copy my mom's figures in her register into my software and see if the figures match. At this point in time I wouldn't trust her to enter the figures herself.

I have Qdata going back to 1994 and its scary to see what one has spent over the years. :tinfoil: Prior to that I did the reconciling the old fashioned way each and every month, guess I am a tad AR when it comes to money.

Same here about being AR with money. I make sure all my accounts balance to the penny compared to what the bank says I should have. So far so good, and I've been doing this since 1989.

Hope your Mom is feeling better now.

She is but we're both still wondering exactly what happened. It's likely a math error as I said, but there's a remote possibility she entered a deposit into her checkbook, then either never made it, or wasn't credited with it ( the former is obviously much more likely ). It's been an adjustment for her taking care of the bills since Dad passed away. Incidentally, in all the years he took care of the bills, I never once remembered his checkbook not balancing or bills not being paid on time.

Also, yes, it's scary looking at how much money one spends over the years.

 

[Beamhead]

Re: Chase's overdraft fee scam

Another thing I did when my Father was nearing the end of his journey here was to get my name on the account and take care of it myself.
I hope you are far from this point though. Just a thought for the future.

 

[burgessdi]

Re: Chase's overdraft fee scam

I don't think all of us are talking about checks exclusively, I'm certainly not (I write a single check a month for rent, and that's it, ever).

Likewise!!! I only write one when institutions don't accept electronic transactions...

I agree on the big bank comment. I prefer smaller ones. The big ones see you more as figures on paper while smaller ones tend to be more personal. I like walking to a teller not having to show my ID

 

[dano]

Re: Chase's overdraft fee scam

Why is it always the evil bank's fault?

All the fees, policies, etc are given to the account holder. I get these fee & policy change notices all the time, and I READ THEM. The fees aren't a surprise.

Class action lawsuits? By the time it gets to any sort of trial, you'll be ten years older, and if it wins, will get a free toaster and a Chase Bank t shirt, while the Lawyers get a few million.

 

[jtr1962]

Re: Chase's overdraft fee scam

Why is it always the evil bank's fault?

If you read through the link to the class action lawsuit you can see that the banks basically have policies which both encourage irresponsible behavoir, and also maximize their profits from such. I'm not against banks charging realistic fees to recoup their costs and cover their risks when they loan people money. In fact, I'd rather they charge the people who are greater risks more so those who are responsible don't have obnoxious things like annual fees on credit cards or checking accounts, whether they use them or not. What I don't like is charging fees out of all proportion to the cost or risk, and/or reordering transactions so as to maximize the number of overdrafts.

All the fees, policies, etc are given to the account holder. I get these fee & policy change notices all the time, and I READ THEM. The fees aren't a surprise.

You're one of the few who does. Also, the few times I've even attempted to read these notices ( many of which are dozens of pages of legalease ) I frankly don't understand 1% of it ( and I have a degree in engineering from an Ivy League school ). Unless you're a lawyer, or well versed in legal jargon, these documents are mostly incomprehensible, similar to the language in the link I mentioned ( I don't understand most of that, either, except where the main points are outlined in plain language ). Besides, these notices are usually thrown in with a bunch of other papers, most ads, that the bank sends, along with the usual overwhelming plethora of junk mail from other sources. I'll bet good money 99% throw it in the garbage same day without bothering to read it, which is exactly what the banks are counting on. How about the banks printing major changes to fees and terms in PLAIN, SIMPLE ENGLISH, and right on the front page of your monthly statement? Again, I'll bet good money they won't unless forced to do so by law. There's a good reason changes in law will soon mean customers are automatically opted out of overdraft protection unless they choose otherwise. The banks depend upon deception to collect these fees. They represent what they're doing as one thing, and in fact the terms of the agreement are something much more onerous. I don't know of anyone, for example, who would prefer that a debit card transaction for coffee goes through if it means a $35 fee.

Class action lawsuits? By the time it gets to any sort of trial, you'll be ten years older, and if it wins, will get a free toaster and a Chase Bank t shirt, while the Lawyers get a few million.

If you read my next to last post prior to this one, I've pretty much determined that the way my mom's overdraft worked is that they only charge interest on the outstanding balance. Granted, it's rather high interest, but there are no per transaction fees as seems to be the norm with these types of things. So there is nothing to contest here. It comes to under $300 if I did my math right. In my book, the bank charged a more or less reasonable fee for covering about 7 months of checks. Now had the fees been close to $3000 as I originally thought, I would have felt otherwise. Problem is the type of overdraft my mom has is no longer offered by Chase. Now it's the more onerous kind with per transaction fees plus interest, the kind any sane person should run, not walk, away from.

 

[LuxLuthor]

Re: Chase's overdraft fee scam

Why is it always the evil bank's fault?

All the fees, policies, etc are given to the account holder. I get these fee & policy change notices all the time, and I READ THEM. The fees aren't a surprise.

Class action lawsuits? By the time it gets to any sort of trial, you'll be ten years older, and if it wins, will get a free toaster and a Chase Bank t shirt, while the Lawyers get a few million.

Agreed. You see the knee-jerk villification even before the facts are known--demonstrated repeatedly.

It's in vogue to hate and assume the worst with Wall Street, banks, and insurance companies. I'm just glad you brought lawyers into the picture.

 

[Beamhead]

Re: Chase's overdraft fee scam

Don't get me wrong, there are many things big banks do that pi$$ me off, don't even get me going on the top dog in all this mess the FRBS and it's secret monetary policies and flat out chicanery..........

 

[gadget_lover]

Re: Chase's overdraft fee scam

Are you serious? They are only providing a service not enabling criminal activity. I

It's not really a service unless you ask for it. If they were providing a service, they would do so in a way that minimizes the charges. They actually maximize them.

My bank has in its rules "Checks will be debited before deposits are credited. The order in which the checks are debited is up to the bank."

Here's how that played out for my son:

Deposited pay check Friday after 5. It was not processed till the batch of the next business day (Monday night). Had a balance of $1050 plus his paycheck.

Gave 1100 to his landlord. Bought groceries and several other purchases for under $50 each. I think there were 4 checks altogether.

The landlord deposited the check Monday. So did the others.
The bank chose to pay the $1100 check, leaving a $50 deficit and a $35 fee. Then it processed the other 4 checks, bouncing them and charging a $35 fee each time. Now he's down $175. The bank then credits the paycheck. And they are nice enough to send him the overdraft notice in the US mail, first class.

By the time he gets the letter, he has mailed the rest of his bills, thinking that he has $150 left over after all are paid. Instead, he finds that several more have bounced and he loses another $100.

The bank made more than $250 by manipulating the deposits and debits to their advantage.

Even if the deposit was not valid or was delayed, they could have bounced the first one and paid all the rest, resulting in a single overdraft. Mind you, they bounced all the others and only paid the first, which set up the cascading penalties.

Yes, I'm serious. It's criminal what they get away with.

 

[Epic Win]

Re: Chase's overdraft fee scam

They stole over 300 dollars in one month alone due to overdrafts (look up their new debt card scam)

 

[Epic Win]

Re: Chase's overdraft fee scam

It's not really a service unless you ask for it. If they were providing a service, they would do so in a way that minimizes the charges. They actually maximize them.

Yes, if they were a service, they would work for "tips" like all other service industry professionals do. Chase, for one, is the bank I hate most. I'll make sure I repeat the stories in this thread to everyone I meet in the future.

 

[TorchBoy]

Re: Chase's overdraft fee scam

As it stands now, the banks are not only enabling people's irresponsible spending habits, but also profiting handsomely from it, and digging a hole for these people which they will find impossible to get out of.

I've heard that before somewhere... as one of the main reasons for the latest economic crash. And it's still happening. :ironic:

 

[gadget_lover]

Re: Chase's overdraft fee scam

Why is it always the evil bank's fault?

All the fees, policies, etc are given to the account holder. I get these fee & policy change notices all the time, and I READ THEM. The fees aren't a surprise.

You probably have not read them all. I say this because my ex was in banking. The agreements always reference the "rules of the bank" and there is such a document. At her bank it was a volume several inches thick. Your agreements include the rules via some language in the fine print. Ask where it says that they can take your daughter's savings account to satisfy your debt. They can do that, and have. It's in the book.

The big banks are, by and large, greedy and they hold all the power in your transactions with them. They are not evil. Only people can be evil.


Daniel

 

[Beamhead]

Re: Chase's overdraft fee scam

It's not really a service unless you ask for it. If they were providing a service, they would do so in a way that minimizes the charges. They actually maximize them.

My bank has in its rules "Checks will be debited before deposits are credited. The order in which the checks are debited is up to the bank."

Here's how that played out for my son:

Deposited pay check Friday after 5. It was not processed till the batch of the next business day (Monday night). Had a balance of $1050 plus his paycheck.

Gave 1100 to his landlord. Bought groceries and several other purchases for under $50 each. I think there were 4 checks altogether.

The landlord deposited the check Monday. So did the others.
The bank chose to pay the $1100 check, leaving a $50 deficit and a $35 fee. Then it processed the other 4 checks, bouncing them and charging a $35 fee each time. Now he's down $175. The bank then credits the paycheck. And they are nice enough to send him the overdraft notice in the US mail, first class.

By the time he gets the letter, he has mailed the rest of his bills, thinking that he has $150 left over after all are paid. Instead, he finds that several more have bounced and he loses another $100.

The bank made more than $250 by manipulating the deposits and debits to their advantage.

Even if the deposit was not valid or was delayed, they could have bounced the first one and paid all the rest, resulting in a single overdraft. Mind you, they bounced all the others and only paid the first, which set up the cascading penalties.

Yes, I'm serious. It's criminal what they get away with.

My bank makes available any deposits under 10k immediately.
Did he speak to the manager? Perhaps he should wait 36-48 hrs before mailing any checks against his deposit? In this day and age of on line banking and seeing your balance and pending activity at any time and usually in real time, I find it hard to blame only the bank.

 

[LuxLuthor]

Re: Chase's overdraft fee scam

My bank makes available any deposits under 10k immediately.
Did he speak to the manager? Perhaps he should wait 36-48 hrs before mailing any checks against his deposit? In this day and age of on line banking and seeing your balance and pending activity at any time and usually in real time, I find it hard to blame only the bank.

And if a person is not "online," almost all banks give you a complete listing of activity, deposits, checks, bank fees, ATM withdrawals, etc. by phone. I cannot imagine anyone writing a check so close to a deposit, without first verifying that funds are available which is easy to find out.

 

[Beamhead]

Re: Chase's overdraft fee scam

They can check their on line banking with their smart phones.

 

[Jay R]

Re: Chase's overdraft fee scam

What we really need is some sort of electronic currency which works like a debit card

We have something a bit like that. It's a card that you 'load' with cash and can then use it like a debit/credit card. When the cash load runs out, you can't use it anymore. Works a bit like a prepay mobile phone. Only thing is, it has no display of the balance you have to get this from the ATM.

 

[gadget_lover]

Re: Chase's overdraft fee scam

My bank makes available any deposits under 10k immediately.
Did he speak to the manager? Perhaps he should wait 36-48 hrs before mailing any checks against his deposit? In this day and age of on line banking and seeing your balance and pending activity at any time and usually in real time, I find it hard to blame only the bank.

My bank makes MY deposit available too, but I have a hefty balance that will cover them. Even then, the bank reserves the right to take that money back without notice.

The people hit by these practices are not the ones that have lots of money. They are the ones who have very little and who live paycheck to paycheck. The balance in their account on payday is likely to be less than $100. Much less.

They may or may not be sophisticated and online. Until they are hit by such practices, they do not realize how bad it can get.

It's really a scam.

On a realted note, I'm glad that most of the banks are stopping the practice of allowing debit cards to be used as credit cards (via overdrafts) with huge ($35 ) transaction fees. That is a step in the right direction.

Daniel

 

[Beamhead]

Re: Chase's overdraft fee scam

I find it odd that the masses are miffed at banks for something that has been status quo for years yet no one rails against the "payday loan check into blah blah" local loan shark establishments that are littering our fair towns and burbs.