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The Thirty-Eight Billion Dollar Fee.

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The Thirty-Eight Billion Dollar Fee.

Excerpted from News That Matters , June 14, 2010

When you do your personal checking you look at your balance and see that there's, oh" say, $1000 in your checking account. So you write check #100 for $100. and you write $900 as your balance. Then you write check #101 for $200 and you write $700 as your balance" and so on. Right? That's how everyone does it. Well, that's everyone except Bank of America.

So, let's say you're the typical dude or dudette living on the financial edge. In that case you may, from time to time, use the bank's over-draft protection program knowing that there's a fee involved for what amounts to a short-term loan of a day or two and you're willing to accept that fee, usually around $30-$35.

Over the weekend you look at your bank's online system and see that there's $500 available in your account and you go out and using your debit card you buy gasoline on Saturday morning, some groceries after and so on through the weekend. On Sunday evening you see that each debit has been noted to your account, the available balance being lowered for each one. Now you have $300 in your account and you write a check for some bill for $600 planning to add enough to your account on Wednesday to easily cover that check -- including the overdraft fee which you are happy to pay for the convenience.

Fee'd To Death

On Tuesday morning you awake to a terrible surprise to find that each of your charges over the weekend is now carrying an over draft fee of $35, even the 12 bucks you spent buying two Kids Meals at McDonalds. How did that happen? Well, see, Bank of America doesn't actually, really and genuinely tap your account over the weekend because their computers don't work even though the online banking system says that they do. So on Monday night they grab all the charges from Friday and apply the largest ones to your account first.

This is a trick the banks play designed specifically to throw your account into overdraft so that the fees pile up rapidly becoming an onerous burden that can make or break people. In fact, its the tens of billion dollars in fees that have pushed many Americans over the financial edge and I know many of you have been there.

You call the bank and you ask them about all this and while customer service is very nice your call always ends up like this,

"Sorry you got screwed but we cannot and will not ever return your overdraft fees and we're truly sorry but hell will freeze over and the Pope will convert to Judaism before we admit we ever did anything so cruel as to intentionally mislead you. Thank you for banking with Bank of America. Enjoy your day!"

And if you elevate the call all the way up to the upper echelons of the Customer Service loop, some guy with a cryptic name such as "Jeff 1580, Central California" and with a gruff, threatening voice, will angrily call you on his cell phone from the golf course with his pet Congressman caddying, and tell you that they've made their Final Decision so please, stop trying to understand the intricacies and secret banking practices that just cost you what could be hundreds of dollars. Someone has to pay the greens fees, right? And congressmen don't come cheap.

You Are Not Alone

This happens every day to thousands of people across the nation and while Bank of America is the most hideously evil of the lot, many banks play this game and billions of dollars are pulled from the economy and go to subsidize executive bonuses, stock dividends, the purchase of Congressmen and Senators, nifty automated teller machines that work so slowly you have to shave again by the time you're done using them and which cause traffic tie-ups on Friday evenings that CBS radio reports along with, ""and it's 40 minutes to The George."

What good are your online banking account balances if they're not real? If you ask Bank of America for an explanation you'll get one that does not make any logical sense. If you call again and get a different customer service center you'll get a different but equally bizarre explanation. You could spend hours on the phone speaking to CS reps all across the nation and never get the same answer twice. In fact, it turns out that for Bank of America each CS center has different rules and different permissions.

But what's more, is that if you call to complain and they've already refunded a fee at some point since dinosaurs roamed the earth, they'll deny your request and then finagle with your accounts, signing you up for this or that, linking this account to that account, all with the promise that this will prevent future fees but that, in reality, will cause you even greater hardship in the future -- and higher, much higher fees.

But this does nothing to solve the problem of the reality of how their internal accounting system works vis-a-vis what they show you on your computer screen. Those two systems will still be in disarray leading thousands of customers -- each day -- to believe they have available funds that they do not have, an intentional ruse by Bank of America and others, to confuse, befuddle and screw you.

Let's say you are the persistent type and you know deep in your heart that someone at Bank of America can push the right buttons and refund those unexpected fees even though you also know they are strongly discouraged from doing so. You call the 800 number and you reach a dead end. You call again, getting a different call center and you reach another dead end. You call again" wash. rinse. repeat. All in all you spend about three and a half hours on the phone before the gruff-voiced guy calls you and menacingly tells you to stop calling.

You've spent about 210 minutes on the phone which cost Bank of America a tiny $4.20 in phone charges but way more than that in employee time and you earn a bit of satisfaction knowing you are making them slowly suck up those fees.

Then reality strikes! and you realize that they would spend any amount of money to defend themselves against what amounts to immoral and unethical -- but quite legal -- behavior.

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