Skip to main content

I know some of you are aware of the latest racket by our banks to squeeze more blood out of the rocks they call customers. It's where you use their Check cards like a Visa or MasterCard and the balance in your account is the same as a credit line in a credit card.

They must have gotten jealous at some point of the huge fee income that Credit card issuing banks were racking up so they most generously and without their customers permission gave you so called overdraft protection on your check cards.

And boy did it work

Consolidated fee Income from this latest scam was 4.8 Billion and growing like a weed. They are so proud of themselves too.

For those of you who don't know about this new scam to empty your wallet. Say you are getting low on funds in your account. You head out for the day. Stop at Starbucks, pick up a coffee, maybe buy a book at half priced books or use it online at a few places to get some necessities.

Unbeknownst to you your balance is down. Maybe it's a shared checking account or maybe some raided it. OR maybe you just forgot. But each one of those charges that the bank so generously let through cost you anywhere from $26.00 to $35.00. So say you had 8 or 9 micro purchases totaling $150.00 or so. You go home. Get online and find you spent $450 instead of $150.00. Each time you used the card they hit you with that fee. Now you see how a poor family could easily get shoved into the arms of a pay day lender. Because when their employer does a direct deposit, the negative balance caused by those fees eats that paycheck like a snack.

Today, I said I wanted to Opt-out of the scam. It was apparent that this request was unusual as they had to call three people to get the paper work to take that off my account. They didn't seem pleased. Perhaps some bonuses are ties to it. I don't know.

So if  you ever find yourself in that position, please tell your employer to issue you a regular paper paycheck and cash it at his bank. Then go open a new account at another bank and opt out of any so called check card overdraft protection.  Or in raw terms- tell em to stick it. The Rat Bastards.

If your reading this, I have one more thing to piss you off:  those of you who are as angry as I am about these bankruptcy laws, should go check out  Citibank or Chase's 2006 income at www.sec.gov. Thanks to the laws, billions were added to the bottom line. Citi Alone added 1.5 Billion just for the credit card division I beleive. It was not because they got new customers but as a result of reduced filings and protests at filings, they were able to reduce the loan loss reserves they had by a whooping Billion plus. Not only that their fee income sky rocketed.

The final insult to ones sensibility and idea of fair play is  the 21 Billion in net earnings in 2006 just wasn't enough for Citi. So they laid off 15,000 employees. I wish former Treasury Secretary Rubin hadn't gone to work for these theives. He did a hell of a job as a public servant only to have all those years wiped out by taking a paycheck from these Loan sharks.

Originally posted to Dburn on Sat Apr 21, 2007 at 12:09 PM PDT.

Poll

Do you know anyone who has been ripped by these theives?

62%20 votes
3%1 votes
9%3 votes
9%3 votes
0%0 votes
15%5 votes

| 32 votes | Vote | Results

EMAIL TO A FRIEND X
Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags

?

More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

  •  i use a credit union... (8+ / 0-)

    and get treated like a human being
    theres no reason to do business with a commercial bank

    Veterans denied benefits for 'personality disorder'

    by snacksandpop on Sat Apr 21, 2007 at 12:11:09 PM PDT

    •  Ummm (1+ / 0-)
      Recommended by:
      peaceloveandkucinich

      Be careful. If for some reason you get caught in a rut and have a loan out for say a car and have a credit card and are forced into a bankruptcy they can empty your checking account in what's commonly referred to as a set off to help cover the balance owed.

      Or if you can't make the payments on the car and they repo it, they'll freeze your checking or savings account and then empty it to make up the deficiency when they auction it.

      Other than that, they are fine institutions.

      Support the Troops, Impeach Bush
      Oversize Rants Available Overnight at
      The Image Factory

      by Dburn on Sat Apr 21, 2007 at 12:22:19 PM PDT

      [ Parent ]

  •  New Banking Rules Rob Small Depositers! (4+ / 0-)

    Thanks dburn, I think some of these new banking ripoff schemes are a result of the new bankruptsy laws.The penalties and hidden charges fall disproportunately on the  low income ,working class person who lives paycheck to paycheck.
    I also opted out of a overdraft protection account for the same reasons.Have you ever noticed that when you deposit a check from out of state,some banks make you wait a week for the check to "clear".Conversly your check sent to an out of state party "clears"at the speed of electrons!If you deposit checks in the bank your reciept will sometimes stipulate what percentage of the funds are "available"and often these numbers are meaningless.Thankfully as you mentioned in your diary we can now go online to see what the hell is up in the twilight zone of our accounts.
    I think I spent almost 400 bucks of my poverty level income last year on banking penalties due to incomprehensible banking rules .I was only trying to access my own funds,not "bouncing " checks.I found out quickly that my account overdraft protection was a scam even with a separate account and minimum balance to draw from.Most of the other po folks I know have been similarly robbed by thier banks! Thanks for your diary,I think I will write about this shit to Chris Dodd.I believe Sen. Dodd is on the banking commitee.     peace out. kg

    •  I think when history is written (2+ / 0-)
      Recommended by:
      TracieLynn, kurt

      On this time period, people will realize the greatest beneficiaries of this low life administration has been the banks. Also if the economy collapses into a depression despite the record breaking numbers on the Dow, I think history will show the killer snake that bit the economic leg of the US was called Bank.

      They have laid low as the energy and health care companies have absorbed much of the ire of the American people. But when I see what the banks are doing I think they either equal or out do any of the other industries combined in picking the pockets of Americans who can least afford it.

      I remember when I lived in a bad part of this city and moved up to a better part . The first thing I noticed was grocery prices were lower. I wondered and then I realized that the grocery stores in the bad areas knew their customers had nowhere else to go so they jacked their prices up.

      What the banks have done have used IT to instantly determine the economic capability of a customer to leave the bank and move to a competitor - especially with credit cards. If they model the computer gives them show a low probability, then the death grip starts. Universal default is a high tech version of price gouging.

      When the profits started pouring out and no one did anything, banks who didn't have the benefit of a credit card operation or had one and had plenty of customers on the edge started the fee based ATM check card rip.

      Again, no one has said much or done much. Each time they get away with it they press the gas a little harder to see what else they can get away with. All eyes on the quarterly results. No thoughts given to the long term implications.

      Support the Troops, Impeach Bush
      Oversize Rants Available Overnight at
      The Image Factory

      by Dburn on Sat Apr 21, 2007 at 02:25:59 PM PDT

      [ Parent ]

  •  Check holds and other sad aspects of life today (1+ / 0-)
    Recommended by:
    Dburn

    I work at a credit union. I encourage everyone to find a credit union because they will treat you fairly. That doesn't mean we won't charge NSF fees, or late fees on loans or credit cards, but when we charge fees and how much we charge will be better than at a huge national bank. We'll let you opt out of overdraft privilege. We'll give you free online and phone access so you can keep track of your balance. And we'll negotiate fees if you have a good history and make one mistake.

    But no matter how nice we want to be, we will still place holds on checks you deposit. The sad fact of life is we get thousands of bad or fraudulent checks deposited every week. We may know and trust our members, but we don't know and can't trust the people who write checks to them. We cannot give access to funds until the check has cleared. We will give you access to $100 immediately, but if the check bounces, you have to cover that.

    If we gave immediate access to funds for all checks deposited, we'd have huge losses. And those losses would be coming out of our members' pockets. Fees and loan rates would have to go up to cover the losses. We couldn't pay 5.15% on your grandma's CD. We have to do what's fair to everyone.

    •  1864: In Indiana anyway (0+ / 0-)

      Any Check under $5000 deposited can be drawn on the next business day. Any check over $5000 can be held up to 3 weeks as of late 90s. I don't know if any laws have been passed that change this now.

      But the point of the diary wasn't really hold time on checks. I know the new laws allow scanners to digitize checks and banks get the benefit of immediate funds and make some money on the float.

      I really don't care as much as I do about a conscious decision to put a person who is obviously low on cash in for whatever reason in a worse place by setting their computers to allow x dollars over balance to go through on a check card in order to make a profit.

      The fees for these small loans, and that what they are, can have effectively have interest rates of 1000s of percent on small purchases. This is something they can control technically which is evident becuase you can opt out of it.  Some credit card companies decline charges over credit lines, some set a formula to allow charges in order to make additional money from fees.

      Here's the killer to me. The bank sets the credit line either by extension of a credit line or the balance in your account but makes exceptions for itself to charge over that credit line or balance for fee income. If one can't charge over the line for food than a bank shouldn't be allowed to charge over the line for a profit.

      So they send out little notices in 2 point type and most people only find out about the hard way. I found out through a decent Blog. But, I've heard about people since spending months digging out of a financial hole caused by those fees.

      The Banks have shown again a level of irresponsibility not seen since the depression and that they don't deserve lax regulation as they cannot be trusted to be ethical in the way they run their business.

      I'm sure a credit union is better. I'll probably give one a try. But, I live in a big city, so I imagine it won't be much better but I would hope their ethics level is higher.

      Support the Troops, Impeach Bush
      Oversize Rants Available Overnight at
      The Image Factory

      by Dburn on Sat Apr 21, 2007 at 03:45:33 PM PDT

      [ Parent ]

      •  Frozen funds held Hostage by bank? (0+ / 0-)

        House,I have had existant funds frozen when a check is clearing because it exceeded the balance of the account and the overdraft protection account.Is this normal ? cost me alot of bread once. kg

      •  dburn many new scams from new laws (0+ / 0-)

        Yeah,I used to have the same deal years ago,but since then have sworn off credit totally.I do use a check card rarely and that account used to be overdraw protected but those rules are just as screwey.  kg

      •  We struggle with this (0+ / 0-)

        We have members who thank us for allowing them to have their checks paid and they gladly pay the fee because it's less than the payday lenders charge. We have members who come in and withdraw money at the teller window, and are told they will be overdrawn and will be charged the fee, and they say they know, so they are taking all the cash they need now for the next few days so they only have to pay one fee.

        We have other members who think that allowing a check to clear or a debit card purchase to be made when they don't have enough money is robbery and we are tricking them into paying a fee.

        We send a letter and a brochure (in 11 pt type) to everyone who has overdraft privilege explaining it and telling them they can opt out. We send this out annually as a reminder.

        We do offer lines of credit with no annual fee to cover overdrafts, and we let people set up as many as eight different savings sources for automatic transfers to cover overdrafts - including other accounts (with that account owner's permission, of course). For example, my daughter would have money transferred from my savings account if her checking account is overdrawn.

        Initially, we didn't want to offer the paid overdraft service, but our members requested it. We worried that this was taking advantage of people of modest means, but the feedback we get from our members is that this can be a lifesaver.

        We don't want members using this on a weekly basis. We have two on-staff credit counselors who proactively reach out to members who use the service repeatedly, offering to help them set up a budget.

        Sorry, but I don't know about regs in Indiana. We have offices in nine states and we can put 3-day, 5-day or 14-day holds on checks depending on the Fed district in which it is written. But we also have someone who manually checks for cleared funds every day removes holds as soon as the check has cleared.

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site