New law on ATM overdraft fees goes into effect this weekend., page 2

Originally posted by mothershipzeta
Bank customers get break from ATM overdraft fees

Beginning Sunday, banks and credit unions no longer can approve and charge penalty fees for one-time debit-card purchases that exceed customers' account balances unless the account holders have agreed to "opt in," or accept overdraft coverage.
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For years, banks simply had denied these transactions. However, by allowing them to go through without the cardholders' consent and charging $34 for the "service," standard or "courtesy overdraft coverage" reels in more than $10 billion in debit card fees each year, the center estimates.

Even better, when debiting a day's transactions from your account, some banks (such as Bank of America) will actually make sure to process your biggest payments (checks and debit cards) first, regardless of when they came in, so they can deplete your account quickly and ding you for as many overdrafts as possible. AND, if you've had a few overdrafts, they'll put a hold on future deposits for as long as a week. That way, they won't hit your account and as a result you get even MORE overdrafts.

A 2008 survey by the FDIC found that 81 percent of banks allowed overdrafts on debit card transactions and ATM withdrawals, but only 8 percent informed customers of their cash shortfalls before the debit card transactions occurred. Only 23 percent did so on ATM withdrawals. Advance notice would have allowed customers to cancel the transactions and avoid the fees.

It is truly sad that so many personal, corporate and banking fortunes are made by simply manipulating money while contributing nothing to society. At least this is a step in the right direction.

[edit on 8/12/10 by mothershipzeta]

Bank of America committed fraud with my name and it's because of this I can't get a bank account.

At a young age I was ran through the ringer by the scheme ran by the banks. I know exactly what you're talking about, I used to hash it out all the time with them you know.

"How can the holder of my money charge me funds beyond what the bank already knows I do not have and then goes so far as to keep penalizing me until that balance is met?"

I could understand if this was a world where banks weren't so intricately woven into the tapestry of our society but actually we live in a place where money is only safe in the protection of banks. How is that, that honestly scares me. I have no bank account my money is hidden, I have no other option. For banks to place this imposition on us, for the time it had been practiced, was surely unjust and I believe banks should be taken to the courts. I don't believe they will though becase of how much they control, so I guess I'll just sit down and shut up...