Bank Fee Scams. One less Anti-Consumer banking practice to deal with!
May 6, 2010
By Kara O’Donnell, Bankruptcy Attorney in Quincy, MA
In one of my previous posts, I addressed a widely used banking practice of the “Automatic Overdraft Protection.” View here https://quincylegal.wordpress.com/wp-admin/post.php?post=143&action=edit
The problem was that the banks, without even requiring your approval, would allow you to withdraw funds from the ATM or make charges to your debit card and then HIT YOU WITH AN OVERDRAFT FEE. Remember the old days? When if you didn’t have enough money in your account, the ATM would say DECLINED? Those days are long gone and have been for quite a while.
BUT NOW, there are new Federal regulations coming into play – finally! Score one for the consumer!! It seems new laws now require the banks to decline the ATM withdrawal or debit card transaction UNLESS you opt in. (Note: Do NOT opt-in. You will forget you have done so then regret it later when you see 3 overdraft charges on your account for one day of buying coffee, lunch and dinner.)
Below is a notice I just got on my Sovereign/Santander account.
Important Changes to Your Account.
Under new federal regulations that will take effect this summer, Sovereign will no longer authorize overdrafts* on your checking or money market savings accounts for the following transactions**, unless you authorize us to do so by opting-in to our overdraft program:
ATM withdrawals and transfers
One-time debit card transactions
If you opt-in and one of these transactions overdraws your account, Sovereign may pay the transaction. If we do so, we will follow our standard overdraft policy*. If you do not opt-in to this program, and you try to make transactions when you do not have sufficient funds, we generally will decline the transaction.
Learn more about ATM and Debit Card Overdraft Elections.
To opt-in, call 877-SOV-BANK (877-768-2265) or visit your local branch today.
* An overdraft on your checking or money market savings account occurs when you do not have enough money in your account to cover a transaction, but the transaction is still processed by Sovereign. Under Sovereign Bank’s standard account overdraft practices, a fee of up to $35 will be charged for each overdraft on your account. If your account is overdrawn for 5 or more consecutive business days, an additional $5 per day will be charged. There is a limit of 9 fees per day for overdrawing your account.
** Sovereign will continue to authorize overdrafts for checks and other transactions made using your account number, automatic bill payments, Online Banking payments and transfers, and recurring debit card transactions. Overdrafts are always paid at our discretion, and we do not guarantee we will always authorize and pay any type of transaction. If we do not authorize and pay an overdraft, your transaction will be denied.
Kara O’Donnell, Esq.
O’DONNELL LAW OFFICES (857)526-1355
Posted by Kara O’Donnell