I’m mad as hell.
I wish I could say that I’m not going to take it any more but it seems I have to suck it up and deal with it. In the United States, in the year 2009, banks have the power to do whatever they want to whomever they want and we, their lowly customers, are expected to sit back and take it. Actually, that’s an exaggeration. We’re fairly useful when they need taxpayers to bail them out for their greedy and improper investments.
So what am I so angry about? Check this out and let me know if it sounds familiar.
My bank was sold during the economic collapse to a foreign bank in Spain. Ever since this happened, I began to notice that items I deposit into my checking account were being held much longer before clearing, while purchases made with my Visa Check Card, which used to clear my account roughly 24 hours later, are now clearing instantly. This means that the money coming OUT of my account is clearing instantly, but the money going INTO my account is taking at least three days.
For those of you playing along at home, here’s where it gets really ridiculous. My husband and I have our business account and our personal account at the same bank, at the same branch. When I issue a payroll check to myself from the business account and deposit it into my personal account, it’s never leaving the same bank. You can’t find a check that’s much more “local” than that. This is the same bank that has access to the balances of both accounts. Surely they can tell if I have enough money to pay myself. Shouldn’t my payroll check clear instantly? It is the 21st century, and the bank has computers for godssake. It’s not like we have to wait for Pony Express to come and pick up the money bags. Logic says that this transaction should be recorded, cleared, and posted with a single keystroke just like my VISA Check Card purchases evidently are. Why do I need to wait three days for my check to clear from one of my accounts when I deposit it into my other account?
The insanity gets worse.
A customer recently paid us by check for some work we’d done and I deposited it into our business account. I waited for it to show up in our account as Available Funds, which it did, four days later. Like other business owners with expenses, I paid some bills with it.
Today, I went online to check my son’s bank balance for him, and quite by accident, happened to notice that our business account’s balance was much lower than it should have been. As I checked the list of recent transactions, I discovered in horror that the customer’s check had bounced few days ago and as a result, several of our checks to others had bounced as well. As I viewed the string of Insufficient Funds fees at $35 each, I became physically nauseous. Watching the bank get richer while I rapidly grow poorer tends to have that effect on me.
To further make me feel as if I’ve stumbled into some alternate universe, a phone call to the bank revealed that in order to be “totally safe,” I should allow 10-15 days to be really, REALLY sure that something has cleared. 10-15 days? Are they kidding? How can we, as a nation, effectively conduct business if we need to allow 10-15 days (one-third to one-half of a month) for each deposit to clear? What year is this again? People probably didn’t have to wait that long for a deposit to clear in 1950!
While I’m on the subject of incorrigible banks, good old Bank of America has been up to more dirty tricks.
Back in March, I wrote about how Bank of America automatically assigned a Default rate to my account for being late by 4 days when I hadn’t received my bill. I'm a long term customer who had not been late previously, but I was told that nothing could be done to remove the Default rate. If I paid my bill on time for the next six months, they’d consider revising my rate at that time.
I had intended to transfer my balance with Bank of America to a new lender, but fears of my FICO score being damaged by the resulting change in my debt ratio made me decide to keep the balance with them.
This past month, I learned the painful lesson that there is no way to avoid screwing up when it comes to dealing with Bank of America.
When my bills come in, I immediately sort them and mark the payment due date and amount on the front of the envelope, and file them in order of payment urgency on my desk. I’ve organized my bills this way for my entire adult life and it’s served me well.
My Bank of America bill was due on the 28th. I typically pay my bills online, which is instant, but decided to pay Bank of America a few days earlier, just to be extra sure they received it in time.
It was a Thursday afternoon, 6/25, when I paid the bill. The bill was due on the 28th, which is a Sunday. Would you believe that Bank of America wouldn’t post my ONLINE payment (again, we’re using computers, people) until MONDAY, a day late, because the due date wasn’t a business day?
Yes, that’s right. They’re the ones who set the due date, which changes slightly each month for some super-secret reason, but won’t allow my payment to be posted on that day because it’s a Sunday. Why make a due date on a non-business day then? Why did they not allow my payment to post instantly on Thursday or the next day, Friday? And what happened to Saturday? Every bank is open at least until noon on Saturday.
To me, these deceptive practices feel like deliberate schemes to shake more late fees out of us and keep interest rates high. I bet that I’m not the only victim of it.
Between Sovereign Bank and Bank of America, I’m completely outraged and disgusted, but what can I do? Do I even have a voice against greedy and corrupt yet powerful banks?
As this country struggles to emerge from the most devastating economic downturn since the Great Depression, despicable practices by the very banks that we, as taxpayers, bailed out seem intent on keeping all of us under water and at their mercy.
Will someone please tell me why we didn’t just let them fail?
Comments
I enjoy my credit union. Got fed up with the blood sucking practices of banks in the '80's.
Yes, they should have let the banks fail They also should have GM fail. It may have been painful for the short term but it would serve as notice to others looking for a handout.
The scam of holding your deposits but releasing your debit card charges instantly is a huge money maker for them and the number one tool they use to screw people. I don't care how convenient they may be I do not think anyone should use a debit card. I have dropped out of the system with great success.
I have one credit card--one that I load with money and when the money is used up the card is no good until I load it again. No hidden fees, no annual fees, no late fees, I pay $9.99 a month for unlimited use. I pay cash for everything. I cash my check in person at whatever bank the check is draw on. Of course, some of them have started charging me five or six bucks to cash a check from their bank! I howl and protest at being ripped off for cashing a check that takes them seconds to confirm that the money is available. What happened to banks providing good service, making a decent profit on loaning money and being a part of the community? No, now it is rip people off with hidden charges, fees for nothing and call yourself a success. The banks are like the Mafia used to be. I share your frustrations.
The SEC cared about digging out suspect bank practices back then. Nowadays they can't find their proverbial asses with both hands.
Con - You said it. What are the incentives for banks (or GM or AIG) to adopt better business practices if we're shoving money at them to keep them afloat? And certainly banks who didn't need the funds shouldn't have been forced to take them. That's idiocy. Unfortunately, the community banks around here have either fallen already or are in trouble. Only the big, impersonal ones are left.
nerd cred - I'm biting the bullet and making the jump to a credit union. It's far away, but I've got to do something. Have you had any of these issues with your credit union?
Steve - I adore your sarcasm. :)
Blackflon - Nice to meet you! There are SunTrust banks around here, but I'm glad to hear that there's at least one bank that doesn't use sneaky tricks to get rich. Perhaps if all of us moved away from the behemoth banks to the smaller ones, the large banks would get the message.
Dr. Spud - Good for you for figuring out how to avoid making the banks richer. In this area, the banks won't let you cash a check drawn on their bank without having an account at that bank. I like the idea of the reloadable VISA card. I think Umbrellakinesis mentioned that one before, too. I'm going to switch all of our accounts to a credit union and hope for improvement.
flyover52 - Thanks for the info. It didn't seem right to me. Should I bother complaining to someone about it, or just close my accounts? Probably, like you said, the SEC could currently care less about it.
Umbrella - As usual, you're right. I put off making the change (in both instances) so I'm pushed even harder toward it. I found a credit union and I'll move my accounts there. It's not close by, but it will be worth it to not have this kind of bullshit.
I have a small amount on a Best Buy credit card (my first mistake, I know), but their online payments take 4 business days to post. It's such a bunch of crap, in this day and age of automatic everything? I'm going to pay that joker off and shove it where their sun don't shine.
Harry - I haven't been using my credit cards, but I don't doubt that they wouldn't invent new fees to add. They're all crooks as far as I'm concerned.
Delores - Thanks for the Digg! Thanks, too, for helping to affirm my credit union decision. I have a feeling I'm going to wonder what took me so long to make the switch.
Deepcleav - I know! 7 days a week! I was shocked to see that when I was researching the credit unions in this area. And they allow surcharge-free ATM transactions at other credit unions. I probably need to get a life, but I'm really excited about joining a credit union.
Yes, Credit Union is a good choice. I've never (or not yet) had to deal with this sort of thing since I switched. Before that Wells Fargo was nipping and tucking (nipping from me, tucking in their pocket) me to death. Why DID we keep them afloat????
I don't think we should have bailed out the banks or the auto industry. The banks are just trying to make sure their investors are getting paid, they don't care about putting money back into the system so that it moves the economy. The auto industry deserves to fail for making stupid cars, but cars=America, so it's a personal, image thing. Did the government think it was important to bail out Eddie Bauer? They're a huge employer too, but they don't =America, so who gives a crap. And I don't think there should be farm subsidies for huge corporations like ConAgra. You make more than $300K, why do you need government handouts? Grrrrrrr.
Deepcleav - What I perceived to be a lack of convenience kept me from switching sooner but I'm really impressed in learning that the credit unions have formed a network like this. If their customer service is better, too, I won't know what to do!
Cap'n - You said it; "criminal" describes their actions perfectly.
http://digg.com/d1vqYm
Definitely fight to get your money back. EECB seems to be the magic word.
My mother on the other hand .... (Yeah, MOM, for whom adversity doesn't sit well) had an incident with your friends at Bank of America, or as I like to call them, the Fee You To Death bank. I've been trying to get her to switch for years, and they finally pissed her off to the point she went and did it, bless her heart. They demanded my father's signature be on a check she was trying to cash – yeah, Dad, who has been dead for almost 11 years!! And the bank has a copy of his death certificate. She called me, crying, asking which bank it was my friend from high school works at (he's a veep there, I couldn't be more proud for him). She set up a new account there and is in the process of switching crap over and they're treating her much better. She's even found a teller that worked at Bank of America that she knew and liked, so she's happy.
Quite selfishly, *I* am happy because my name (and my brother's name) is on the account. It was at BoA too, but we all know that means nothing. Now as mom continues to age, if there's a problem, I can call my friend and know someone I trust is handling it!!!
All this was to say that yeah, BoA is a bunch of f*^#@%s!!!
For more horror and nausea, read my two blogs on Goldman Sachs.
We didn't let them fail because we are an impotent class of taxpayers just watching them loot our treasury and doing nothing about it.
We get the government we deserve. And it's only accelerating now.
So tired and mad about the same things that I cannot even rant without sounding like I need a coat with wrap around sleeves.
Thanks for doing it.
What reforms? You know what the word "reform" means in Washington these days? I'll tell you:
"I, Congresswo/man Doe, am so pleased to return to my home state/district and tell you that, on your behalf, I supported BANKING REFORM because I care about you, the little person. And since you're keeping better score than ever before, if I call it BANKING REFORM, and you don't have access to the law or the time to unpack what the hell it means, well then, you'll just have to take my word for it, and that's a point in my favor come re-election time."
I heard on NPR a few weeks back that the strongest lobbying force in D.C. isn't the NRA, it isn't pro/con abortion. It's BANKING. Need I say more.
*rated - with gusto
"We get the government we deserve. And it's only accelerating now."
Great news that you’re soon switching to a bank that will hopefully be more personalized to you needs...
It used to be that businesses made money by offering a product or service to a customer, which represented a win-win situation. I get a donut (yummy) and they get my fifty cents (their accountants are happy).
But more and more, businesses make their money by taking advantage of their customers without offering anything in return.
Banks and credit card companies do this by charging penalties when you do something "wrong". Blockbuster did this when you returned a video late.
There's nothing inherently wrong with it, UNTIL they begin building those fees into their revenue model. At that point they begin hoping that you will make more and more mistakes so that they can legally take more of your money with no work involved.
I see this as the Horseman of the Economic Apocylpse - and indicator that capitalism has run its course, that the economic engine has consumed all of its fuel and is now devouring itself.
It represents nothing more than a transfer of wealth from individuals to businesses, from the ordinary people to the wealthy, and as such, in my mind, is a harbinger of doom, indicating that our capitalist model is running on fumes and that, as a country, our best economic years are behind us.
First, one thing that's sometimes useful and you may know about, but others may not, is when transferring from account to account if you need funds quickly, you can go to the bank in person and present a check and say the special phrase “please make this transfer like cash.” Or anything like that. In order to do it, you write the check to yourself, not to the other account. They process it as a cash withdrawal from one account and a cash deposit to the other. That forces it to go same day. They can do it without you uselessly getting cash in your hand and then handing it back, but you have to ask for it that way. If they won't do it that way, just demand payment in cash and then when you have it in hand say “Oh by the way, I want to deposit this cash to my other account...” and maybe next time they'll just admit they really can do it the streamlined way.
Of course, that doesn't address your real problem, which is that they are exploiting loopholes and using a Bush style “because I can” theory of using power. As soon as that consumer protection agency gets set up, things like moving the date, assigning default rates, etc. needs to be on the list of things they regulate quite strictly.
I also know some non-banks that have shady practices of their own. Once I had a bank send a check with online bill-pay and when it was marked a late payment, the bank says they sent it and the company said it didn't receive it. The bank might have lied, but I suspect the lie would be found out. They probably have copious records of money moving. So the story they told me about the payee sounded likely. They said they had other complaints from this vendor (a quite well-established provider of phone service) that led them to believe they sometimes just take incoming bags of mail that look like bills and don't open them right away, then when they finally did open them saying they arrived late. Who would know? For regular mail, which is not traced, there'd be no way to tell. So I don't know if it's true but it sounded plausible. They encouraged me to pay myself and use one of the receipt options (which they didn't offer as a service themselves in their bill-pay).
And I agree with you that if you're being screwed by your bank and you want to move your funds to another bank where you'll be less screwed, you're only exercising prudence. The notion that a credit score can go down due to that is part of what's wrong with credit scoring. I'll blog a whole post about credit scoring sometime. We definitely need a thorough review of what counts as a bad thing there. The present policy encourages consumers not to trade to other vendors, which in terms defeats the claim that there's a free market and people are picking products based on what they like best. What they like best is to be screwed least, and going the path of least cattle prodding can hardly be said to be the free market at its finest.
My cu's locations are also inconvenient but since I almost never go there it doesn't matter to me. If I have to deposit checks (rarely) I mail them. There are little tweaks I do for convenience but it's really all just a matter of getting it organized. Like: I mail deposits directly to a branch, not the central address they want. It makes the deposits faster. They aren't set up to mail my receipt, though so I include as SASE and a little note asking for the receipt. I have a pile of those things pre-printed and left over from a job where I got checks. I used to go there more often when I was being paid in cash a lot. :X
The last time I screwed up and had an overdraft I rushed to a branch, where I'd hardly been in many months, to deposit some money to cover it. The teller remembered me as a customer, said the $29 charge was stupid for a $5 overdraft and refunded it. This is the one that used to be the local phone company cu. Back when there was a phone company. (big eyeroll) Now it's Topline FCU. I don't know how widespread it is.
I use a debit card and haven't even had checks in over a year. (Disclosure: that's due to a screw up on my part I haven't taken the time to clear up. I should have some.)
I don't have a credit card and have no idea what my FICO is. (Can they be negative?) My sister, who has sterling credit, uses the same cu and has no problems she's mentioned. And she would mention it. At least one of her cards, her most frequently used one, is from them. She uses their online bill paying service to pay all her bills.
I took care of a brother's ailing dog at one point when he was traveling all the time. When I had expenses for Brutus I'd call my brother and he'd just transfer money from his cu account to mine by phone. Never a problem.
Now, my rich sister-in-law swears they are constantly screwing up but I honestly think it's her. She's kind of a ditz.
My direct deposit gets deposited in my account as soon as they get it. At times that's been 2 days before bank people get theirs.
I am also careful to keep some balance in a savings account now in case of overdrafts. They will transfer the money from savings to checking. They charge $5 for that but it's a very new fee, I think. I have only used it once.
I don't have a complicated banking life, (despite the way I've made it sound here,) that's something to keep in mind. I don't stress their system much. You can see my whole family uses that cu and we have for 30-40 years. All of them have more money than I have and do more banking and I've never heard a complaint. (Except as noted above.) Even if you only move part of your business as a test, it's worth trying imo.
Everybody needs to go to rollingstone.com and read Matt Taibbi's articles on Goldman Sachs. Deborah Young is right. I'm going to check out her posts also after the dog park.
Kent Pittman: can you still make a check out to "Cash"? That would be another way of speeding the funds transfer or making it clear that you want this to be a cash transaction. And, Lisa, how does the whole transfer thing work online? Is it immediate that way?
It seems clear that a revolution is needed and Obama can't bring it. Either he's truly in thrall to GS or too cautious to cause serious disruption to the system - and maybe that's a necessary responsibility for a president - stability.
The one way we little folks seem to be affecting the economy is by saving, not spending. I call for a revolution - no unnecessary spending and when we do, do it at small, local businesses as much as possible. Take all our money out of banks and put it in credit unions. Sure, there will be pain but maybe the credit unions and small, local businesses will increase their hiring enough to ease it ... maybe there will be just enough disruption to the big guys to send a message.
BBE - They need customers but they sure don't like them.
Screamin' Mama - Thanks for the empathy. :)
bobbot - Sadly, you're right. Instead of allowing the behemoths to fall and the smaller banks to rise up, we've fed the monster and kept it alive so that it can torture us. Oh, to do it all over again...
Deborah - I'll check out your Goldman-Sachs blogs, but I remember feeling like the cat was in charge of looking after the canary when those Goldman-Sachs people were tapped for treasury jobs. Why aren't these incestuous arrangements in government considered to be conflicts-of-interest just like they would be in any other business?
alsoknownas - I love your comment. I know that feeling well. :)
Lisa - Of course, it's all about how they can spin it. Banking HAS been reformed, but not exactly in a good way.
David - I have a lot of faith that switching to a credit union will help to alleviate my banking complaints. Unfortunately, finding a way to be rid of the credit card companies is probably going to require a lottery win or some other form of miracle.
Jen - I think I need your mom to make a call to Bank of America for me. Maybe they'll listen to her!
fins - As dark as the picture you've painted is, you make a good point. Fees do seem to be an integral part of their revenue plan now whereas before they were more like bonus income. Indeed, the system is designed for our screwups and failures as the banks are depending upon that cash flow. What a sick and twisted way to do business.
Now, without going into my books here... The interest on millions of depositors money sitting over the course of a few days makes them millions of dollars.
There's a guy who moved his business a couple thousand miles closer so he could take advantage of tenths of seconds on transactions. Thus reaping the rewards of time.
I shall end this with my normal: I despise Chase bank. And many more.
this identification with the antics of your masters is always welcome news, for them, and maybe registering in public as a house slave will get you a warm handshake as they push you into the 'soylent green' apparatus.
when did you get the notion the world was being run for your benefit? you believed them? in the face of consistent contrary evidence? and you want sympathy.
Right now, I would say go to a credit union. But also write a letter to your local bank manager and the national headquarters and tell them why. I would mention that it is totally unbelievable that it actually takes a longer period of time to clear a check, and if such is the case, they are incompetent. Believe it or not, it will really bug them. It always bugs them when an average customer calls BS on them because they really think we believe their explanations.
Right now the banks have a businesss model that is unsustainable. They actually depend on these fees for their profits, including bounced check fees, which are hard to predict. It's as if we made up our budgets based on the fact that we got overtime last year, so we will assume we will get it this year, and spend accordingly. Totally insane.
nerd cred - Thanks for the info. I'm kicking myself for not moving my accounts to a credit union sooner. Just one question: how have you been able to live without any checks? Not everyone accepts the online payments (trash company, water company, etc. comes to mind.) Thanks, too, for bringing up direct deposit. I should set that up when I move the accounts. That would help by not having to make the 16 mile round trip to the credit union simply to deposit paychecks. P. S. About the dog park: glad to see you have your priorities in order!
Mr. Mustard - Oh, so it was YOUR fault! :)
Mother - Thank you for stopping by. Hopefully, the more people who do give up on banks will send a strong message that we're no longer willing to be their door mats.
Jay - I agree. By letting them fail, it would have encouraged better business practices. By throwing money at them, we've sent the message that we condone, or at the very least, are willing to ignore, what they do to us.
Teddy - You're right; we were told that everything would collapse if we didn't bail out the banks. It doesn't appear that it helped all that much. Unemployment is still increasing; more and more retailers are closing; and credit and loans for businesses are still non-existent. Things still suck and now the banks are even greedier. We can't win!
Nelly - Thank you, although I'm sorry to hear that you're experiencing similar trickery with your bank. I appreciate your support and commiseration.
MB - Yes! How on earth can they be allowed to arbitrarily change payment due dates? That cannot be legal. I think that all of the banks are evil, but B of A is the evil-est.
Kent - Once again, your brilliant mind has nailed it. When you write about the credit scoring, be sure to let me know. Actually, let me know when you write anything. Thanks for the tip about how to get the payroll check to clear quickly. Hopefully, this is the last week I'll need to worry about it since we'll be at the credit union soon.
Al - I'm not looking for sympathy; just for fairness.
Flyover - Totally insane is right. What sort of business depends on its customers messing up in order to turn a profit? I suppose it's easier for them to trick us these days. With no one really paying attention to what they're doing, they can resurrect the same shady practices that were used decades ago. I will send a letter to my bank and it's headquarters although I'm not convinced it will make them want to change anything.
1) Cheating. I didn't mention that I have a BANK account, too. A small one I opened before my credit union started debit cards. I still have checks from them.
2) I pay all my bill online. I don't have any that don't do that. I just don't. I did for a number of weeks park in a lot that didn't take cards of any kind. I would write out 5 checks each week for $3.75 each and hand over one a day. (Easier than remembering to have cash.) That's the last time I remember using checks. Check your water and trash - mine are paid on the same bill to the city, online. Any day now they're going on auto-pay, too.
That would help by not having to make the 16 mile round trip to the credit union simply to deposit paychecks.
Can't mail? Mine generally get there the next day and I can verify online. I have the receipt 2 days later. (If the internets go down I'm so screwed.)
P. S. About the dog park: glad to see you have your priorities in order!
well duh. It was a lovely evening. There was a dog-training class visiting for the distraction and The Bored-With-Obedience-Training Poodle made me proud. Oh yes, we did show off for the expensive trainer. And The Little Dog attracted her usual flock of admirers - except for one guy who said she looked like she didn't like her feet touching the ground. I explained that she was older than dirt with a degenerative spinal condition and he was appropriately apologetic. Then I ran after her because she had got too far away too fast.
Dogs have never caused a single financial catastrophe.
I imagine the rules are available on the internet. I'd research and write them a letter.
Of course, I worked for a small, local bank.
As a caveat, I worked in a bank in the early 80s and computer technology was pretty rudimentary then.
And more specifically about the banks, the ones that we bailed out, the main source of the problem was investment banks. Problems with service fees, etc., are commercial banks. Granted some, like B of A were both, and now there are no pure investment banks, but it is important to keep those things separate. Commercial banks are not perfect, but they did not cause the financial meltdown.
Then throw PayPal into the mix (which I do for my biz.) It can take up to TWO effin' weeks for my funds to be accessible.
I'm not sure how they do it but bottom line, its not just to charge late fees - it's to hold large sums of money and make interest on it somehow...or something. Heck if I know - but its something fishy that screws me constantly.
Oh and when you pay online for BofA, make sure you transfer and don't use their Pay Bill service, which takes longer. Rep. told me that.
nerd cred - This made me smile: "Dogs have never caused a single financial catastrophe." Thank you!
annette - Yes, the Mysteriously Changing Due Date is puzzling to say the least. No need to look for a soul; they don't have one because their greed ate it.
Malusinka - Thank you for stopping by. My bank's check clearance policies do not guarantee funds will clear within any specific time frame, which I guess leaves them plenty of room to clear them according to their own benefit. I guess this is what we're left with after banking deregulation.
Bill - If EVERY bank were to fail, no doubt the chaos you predict would ensue, but what if only certain ones did? I think that might send a message to the remaining ones as well as allowing smaller banks to rise. By giving all of them money, we're allowing them to continue to control us. In their minds, they're untouchable and we just have to deal with it. They're controlling us with fear, while at the same time, doing what they want. It just stinks.
Sourie - Your comment made me laugh! Of course the "hold" music is uber-important because they leave you holding for a real person for an eternity.
Beth - Oh, PayPal is a whole 'nother post, for sure! Thanks for stopping by.