Has your bank signed you up for costly ” over-draft protection ” that is costing you dearly? The Federal Reserve Board wants to hear your comments ( No Gotcha Fees ). Many consumers who are often facing foreclosure and bankruptcy are also discovering, the hard way that they have been signed up for “over-draft protection” programs without their knowledge an option many customers don’t want.
How It Works
Bank customers are often (with their knowledge) signed up for the most expensive “overdraft protection” option which can cost an average of $34 per overdraft, sometimes more than the amount of the original check/debit transaction.
It has been discovered that some banks are holding deposits longer than necessary and causing transactions such as check and debit purchases to go through before deposits are cleared. The result is that banks and credit unions are raking in $17.5 billion per year in overdraft fees, over $15 billion more than the actual funds being covered.
I imagine that this practice is probably going to get worse as banks look for “creative” ways to make more money as they watch more homes go into foreclosure and more companies including banks face bankruptcy. If you have experienced abusive overdraft fees from your bank or credit union visit (No Gotcha Fees) to make your voice heard.