Info for Your Potential

Have you ever wondered why in the world banks have so many fees?

Actually, it’s very very obvious! Banks earn 1/3 of their revenue from fees. They fee their customers into debt…literally. Most of us are the “working class.” I know I wasn’t born with a silver spoon in my mouth and I work for my money. Some folks live paycheck to paycheck, yet the banking industry targets these very people with their unethical, unscrupulous and irresponsible robbery because they know these folks are easy picken’s. Banks know that the working class keeps very little to no extra cash in their checking account and are quite obviously easy targets for unethical banking policy. I don’t care what a bank’s policy is. I know one thing it is not, it is not law and while major banks get away with it because they are not breaking the law, their policy is unethical and deviously unscrupulous. Banks make the Grinch look like the tooth fairy.

For those of you who keep extra money in your checking account, why? Are you like most Americans and fear the inevitable? The day will come when you will make a mistake in your check book register or someone you paid with a debit card has decided that you are their next target for debit card fraud? It is my opinion that having extra funds in a checking account does not make good financial sense and if banks practiced ethical banking policy, it should be totally unnecessary. That money is better served in a money market account, mutual fund account, saving account, Certificate of Deposit (the original CD, LOL!) or some other investment, not for padding your checking account in the event that your bank drains your account by unethical banking practices because you made a simple mistake or were the victim of debit card fraud.

Yeah, yeah, I hear you saying, “But, all I have to do is prove debit card fraud and my bank will refund all NSF fees.” Go ahead, and by the time you finally prove it, your bank will have fee-d you to death. Do you honestly, think the bank will refund all their NSF fees?

Think again. My neighbor told me about her experience with debit card fraud. It took over two weeks to get the bank to realize that she was a victim fraud even after she filed a police report. The bank did NOT refund all the fees. Why? They told her that she should have researched the company she did business with more closely. The bank manager told her that she allowed herself to become a victim of fraud. She closed her account that day and sued the bank. They settle the day after the attorney’s letter arrived announcing she intended to sue.

Let’s look at four of the most popular unethical schemes by banks to rob you of your money.

1. Posting transactions in descending order. Every major bank posts in descending order, largest transaction to the smallest. Why? They can get more NSF fees! Most people find that they on occasion will make mistakes in their checkbook register: a miscalculation, a missed debit card transaction, a missed automatic payment, etc. This happens all the time and banks count on it especially from the hard working middle class who have very little money in their accounts. I had a retired bank manager who told me that since Debit Cards have become so popular, banks count on consumers forgetting to deduct Debit Card transactions from their checkbook registers, because they know they can make a killing in NSF fees. Banks literally have no scruples.

Example: This is what happened to me. I transposed two numbers on a debit card transaction in my checkbook register. I posted $17.10, it should have been $71.10. Here’s what happened: I had four transactions post one day in February, $54.20, 24.31, 5.60 and 4.32 and they posted in that order, largest to smallest. My balance was $47.56 on this particular day. Since my bank’s policy is to post in descending order, which is a very unethical scheme to make more money in NSF fees, I was charged $120 in NSF fees for all four transactions . If the transactions had been posted in ascending order, I would have only been charged one NSF of $30. I was more than willing to accept $30 as punishment for not being more careful, but $120 is ridiculous!

2. Banks approve debit card transactions even when there is no money in the account to cover it. It is the worst of the four schemes listed and shows how determined banks are to generate income in the form of fees from their customers.

I know everyone should know the balance in their checking account and I am particularly anal about knowing how much money I have in my account and not going over that amount, but s**t happens. I recently received a notice from my bank that I had a NSF. I checked my register and should have had $60.98 in my account. I went online and checked my account only to find a transaction for $59 that I did not authorize, but what bothered me more was the fact that my bank had approved a debit card transaction when I had no money in my account to cover it!

How obvious can it be that this bank was using every scheme in the book to make money on unethical banking practices? Even when my balance was only $1.98, my bank approved a $5.10 transaction and then proceeded to charge me $30 for a NSF. This is not only unethical, it should be illegal! If it had been declined, I would have known that something was wrong and could have corrected immediately.

3. Banks post transactions before deposits. This has to be the most obvious as to why it is done and it too should be illegal.

4. Low balance fees on savings accounts. This is the ultimate in ridiculous! It’s a savings account for goodness sake. Some folks work hard to save a few dollars a month and the banks are going to take it away because their customers are not stockpiling money away like a Rockefeller. My bank currently takes $10 a month for a balance below $100. Give me a break! Better yet, Mr. Banker, give your customers a break!

I worked for credit union and we posted transactions in ascending order (smallest to largest), deposits and credits before transactions and debits and if a customer was $5 or less short, we paid the transaction with NO NSF fee and we never charged a savings account fee.

Every bank should do this, but these days it’s a game of brainstorming to see who can come up with the next latest and greatest of unethical schemes to rob consumer’s of their hard earned money. To make matters worse; banks, credit card companies and mortgage companies lobby congress to get unscrupulous laws in their favor with the only intention being that of making millions of dollars in revenue. Greed has happily made it’s home in banking.

It’s disgusting and I decided that I had had enough. Writing my congressman was out of the question since banks literally have congress in their pocket. Credit unions are great, but I am seeing a trend with credit unions becoming mutual savings banks (MSB). How do I know? My bank was a credit union and became a MSB. When it was a credit union, I never had one problem. After the change, I didn’t dare take my eyes off my account for one second.

So, what do you do? Well, private banks and credit unions are great! Credit union customers are actually shareholders in the credit union; therefore, credit unions wouldn’t use unethical schemes to bilk their own shareholders. Private banks are far and few between, but are less likely to resort to unethical means to create revenue.

Then there is what I call a “stand-alone” Visa debit card. It is attached to an account with a routing number, but it is not a full service checking account. There are many of these stand-alone cards, but I like Wired Plastic and All Access (Netspend) Visa Debit cards. No, I am not getting any money for promoting them. I am sure there are others that are just as good, but these are the two with which I have had experience.

Here’s why I like them:

• Direct deposits are free
• There is usually an affordable monthly fee, which gives you unlimited free transactions
• Transactions post as they come in (not in descending order)
• Most, if not all, do not charge NSF fees
• All will decline debit card transactions if you do not have the money in your account
• Some charge a decline fee of about $1.00
• Some offer text messaging daily of your account balance, declines, etc.
• Most offer online services to track your account
• Most offer free online bill pay

Here’s what I do not like:

• If you want to buy gas at the pump, you will need to have at least $50 available on your card
• Most hold transactions in authorization for 30 days or until the vendor posts the transaction. This sometimes results in a double debt. The authorization is deducted and later the vendor post the actual transaction in a different amount. This is usually seen when dining out. The restaurant does an authorization for your total tab, BEFORE the tip. Later the actual transaction comes through as a separate transaction. This will require calling the Visa debit card company and/or the restaurant to get the authorization credited.
• Maximum daily or weekly deposit restriction. Most allow unlimited deposit amount by direct deposit.

A little aggravation out-weights the benefits of not being taken to the cleaners by being fee-d into debt by the bank.

Before those of you who think you are so wise make any comments about how people need to be more responsible with their money, let me point out that many banks set up these schemes to bilk millions of dollars from unsuspecting working class every day. Yes, banks are in the business to make money, but not by taking advantage of the very people who work hard for every penny they make. Yes, some folks have to live paycheck to paycheck. For some, that is their reality, but banks should not take advantage of these folks by getting more fees from posting transactions in descending order, approving debit card transactions when there is not enough money to cover the transaction or by posting transactions before deposits and credits. All are extremely unethical and it is very obvious the intention of these so-called policies.

Take control of your money and tell all the major banks to take a hike!