14 votes

Banks rearranging checking account debits to gain more overdraft fees

Veronica Gutierrez never asked Wells Fargo to act like her mother. The banking colossus just did it anyway. Here's what happened. She bought some sandwiches at Subway for $11.27. Then she purchased car parts at Autozone and went grocery shopping. Twelve transactions into the billing cycle, she wrote a check for $65. It overdrew her account, which should have cost her an overdraft fee of $22.

But Wells Fargo didn't order Veronica's purchases chronologically. Rather, it took the liberty of reordering her purchases so the biggest ones came first. Instead of the Subway meal for $11.27, the bank's reordering placed an $80 transaction at the top of the list.

This fancy footwork allowed Wells Fargo to quadruple its revenue from overdraft fees, from $22 to $88, according to an analysis by the Pew Charitable Trusts.

Does that seem underhanded and sneaky? It sure did to Veronica, who filed a class-action lawsuit against Wells Fargo over the practice. The suit won $203 million in restitution for victims. In his decision, Judge William Alsup cited an internal Wells Fargo memo that predicted the bank would earn an extra $40 million a year in overdraft fees.

http://abcnews.go.com/Business/overdrafts-banks-evil-stepmot...

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I had the same problem with

I had the same problem with Bank of America 26 years ago. What they did was they were holding pay check deposits for 2 or 3 days before they credited our accounts, causing checks to bounce therefore charging overdraft fees. I also had some issues with Wells Fargo in California. They were trying to charge me with overdraft fees because they were withdrawing money from a closed checking account and depositing the money into a savings account that was set up with my joint checking account holder before he died. I fought these people for months before they finally gave in. I made sure that all the checks were paid for before I closed the account, but I wasn't authorized in stopping the transfer.

5/3

has been doing this for decades....

I use Blue Wave, but don't expect one of THEIR silly taglines.

Agreed

This has been going on with banks and credit unions for decades.