US Bancorp Dba US Bank ripoff! Illegal overdraft charges violating FDIC Title VI Sec 604 (3) Minneapolis Minnesota

Melody,

I certainly understand your frustration but I must clarify what you have asserted in your complaint.

First, Firstar Bank acquired US Bank – not the other way around. Firstar merely chose to keep/assume the US Bank name.

As for your assertion regarding the Expedited Funds Availability Act you're not quite correct.

The section that you quote is “Safeguard Exceptions” – loosely described as placing a “hold” on your deposit. This is different than the “Schedule” for making your deposited item available. If a bank places a “hold” on your deposit (delays availability outside the “standard” schedule) and the item deposited is ultimately collected, it is under this section that you are entitled to a refund of your overdraft fees.

If you refer to SEC. 603. EXPEDITED FUNDS AVAILABILITY SCHEDULES, you'll see what I mean. In your case, the bank was processing your deposit under this section not Sec. 604. If not, you would have received a "Notice of Hold" with your deposit.

I am very sympathetic to the situation Melody described. I deposited my husband's paycheck before the end of the business day on Friday. The funds were not made available until Tuesday. We incurred 180.00 in overdraft fees. (90.00 were reversed by the bank manager who was comparatively gracious. The four other people we had to speak with to get to him were horrible.)

I looked at the federal law cited by Eric and it does appear that our bank complied with regulations — barely. There are a variety of unethical practices that are not illegal. I just did not expect my bank to engage in any of them.

I am wondering if US Bank incurred any additional expenses because of Melody's or my actions. If they did, do these expenses approach 259.00? Do they approach 90.00? Finally, I am wondering how much revenue Bankcorp makes a year as a result of bank penalties. Are there any trends? I understand that low interest rates and free checking have impacted bank's profits, however, it is not right to place the burden on people who are least able to pay it. I am planning to file a complaint with the FDIC and I suggest that Meldoy do the same. In fact, anyone who has experienced this should consider writing to:

Board of Governors of the Federal Reserve System
Division of Consumer and Community Affairs
20th and C Streets, N.W., Stop 801
Washington, DC 20551

They may not be able to get our money back but I am guessing that they collect data and I think this practice needs to be brought to their attention.

Marie,

You make some good points but let me clarify some things for you as well.

You wondered if US Bank incurred any additional expenses because of Melody's actions. The answer to that is yes and no. In short, when the bank pays checks out of funds that aren't collected it assumes a certain degree of risk. The risk is that if the bank pays the items and then the deposited item is subsequently returned, the risk to the bank is that they will be unable to collect from the customer and will suffer a financial loss.

Now, that seems silly to customers like you or Melody because obviously you would make good on your account – you are responsible and honest. Sadly, banks across the US collectively write off millions of dollars each week because of those who are less honest and less responsible than you are. Remember, when you deposit a check, you're depositing an IOU – a promise to pay. Until the bank that the check is drawn off of pays the check it's not really money “in the bank”.

You also wondered how much money US Bank makes off of fees collected from customers. I see what you're getting at and you are absolutely correct. Banks make most of their money on interest income (basically the difference in what they pay on deposits and what they charge on loans) first and fee income second. Banks are not non-profit organizations and they, like any other business today must strike a balance with regard to products and pricing that allows them to make money for their investors (shareholders). If you don't think that necessarily affects you, consider that about 90% of all 401(k) plans in the US today hold US Bank stock.

That said, most banks in the US today offer several alternatives to protect their customers against overdrafts – particularly in instances identical or similar to your and to Melody's. The most common version of this is some sort of product called “Ready Reserve”, “Quick Credit”, “Overdraft Credit”, etc. You may even have been offered it at some time during your time with US Bank. Often, people balk at the high interest rate (21.75% at most US Banks) and decline it. Oftentimes, overdraft protection costs you nothing unless you use it. Consider the following: In your case, let's assume that the checks that came in overdrew your account by $5,000. It probably wasn't that much, but we'll take a big number to emphasize my illustration. If you had overdraft protection, even at 21.75%, the interest on $5,000 would have cost about $2.98 per day. Your husband's check was available the next business day so at minimum it would have cost you $2.98.

But let's pretend that you didn't realize that the overdraft protection had kicked in until you received you next statement. At the most, that would be 45 days. This interest has now cost you ($2.98/day x 45 days) $134.10 – still almost $50 cheaper than the fees you incurred. I will concede that bank overdraft fees are egregious. That said, it is one fee a bank may charge that is 100% avoidable – you NEVER have to pay an overdraft charge if you are an informed consumer with some sort of overdraft protection.

Finally, with regard to writing the Board of Governors of the Federal Reserve System, as a consumer you can also contact the OCC (Office of the Comptroller of the Currency) and the FDIC to make a complaint against a financial institution. As a consumer you must do what you feel you need to. Please remember that among all of the banks in the US today, each one will choose to make its money or save expenses in some way, shape or form and they must go through the same balancing act as US Bank.

Maybe you could find a bank that gives you immediate credit for deposits or charges a small overdraft fee. Perhaps then they won't pay you as much for your deposit or lend you money at the lowest interest rate around or maybe you have to wait longer in a teller line because they have fewer staff. Who knows? You need to find the one that is right for you. If US Bank (or any bank for that matter) finds that a particular product, service or practice is causing them to loose customers then they will choose to change it.

Good luck!

This has been going on FAR too long. They need to be stopped NOW!!!!!!!!!!!! Complaints are across the states. Go to AARP website to view how they have messed with seniors. WHEN WILL IT END????? In my case ----My governmeent DIRECT DEPOSIT paychecks on friday were not clearing till tues. SOMEONE PLEASE HELP...........

i am very curious to hear the specifics of these cases. i have a few stories of my own. if you would like to discuss call me at 215-783-9483.

Why Couldn't US Bank, instead of charging us overdraft fees for a check that does clear, charge us only if the check doesn't clear? We have the money in our account.

US BANK informs managers that their over 50% of the banks revenue is genertated by "Overdraft Charges. They are so CROOKED that they have spotters who look for negative postings on the Internet and reply with "Well Maybe Its Your Fault" diologue. I agree with your posting and have been a victim numerous times.

Until the sick B.... in DC stop stealing, and getting money from the BANKS you don't have a chance.

But, one day maybe these CROOKS will be dealt with.

THIS IS A POSTING OF SOMEONE WHO QUIT US BANK AND KNOWS ALOT ABOUT THEIR CROOKED OPERATIONS !!!!! SO DON'T LET THEIR HIRED SPOTTERS B.S. YOU WITH THE PAID REBUTTLES. US BANK IS CROOKED TO THE CORE !!!

Of course a good chunk of USB's income is based on fees. They're a business; not a charity. Not all of that chunk is overdrafts, though; the majority of it is interest off of loans and mortgages.

Does anyone else think that it's funny that I'm on here telling people how they can avoid overdrafts and yet I'm accused of being a USB employee? If I was really a USB employee, I probably wouldn't tell you how to avoid that fee now would I?

The reason people think you're a paid employee of US Bank is because you don't really tell people how to avoid fees. What you do is try to make people seem foolish and irresponsible so that USB is not seen in a negative light, not to mention the fact that you seem to comment on just about every post on here, spending much time and energy to defend USB and no one can understand why if you aren't being paid to do it. If these people are truly all just irresponsible and USB is blameless, why haven't I (and many others I know) had the same issues with every bank I've been associated with? Did I suddenly become irresponsible overnight? I've never had a problem with overdraft charges in my life until I got an account with them. I don't think that's some strange coincidence. Engineering your fees to exploit the struggling customer for maximum financial gain is unethical, plain and simple. Just because something is legal doesn't mean you should do it. This bank is arrogant. They think they can get away with these practices because if they lose a few hundred customers here and there, it doesn't matter because there are a million others where that came from. Do you know how many people I've overheard in the bank who honestly couldn't figure out how their account went in the negative even with the statement right in front of them? I've looked at my wife's statement before when her account went in the negative and it didn't make any logical sense, so I took it to the branch so they could explain it to me and they couldn't understand it either so they waived the fees! Doesn't this seem odd to you? The bank itself couldn't even understand how or why they were charging me hundreds in fees? What if I had just paid the fees without even looking at it? Well that's what they count on, for us to just suck it up and pay the fees. That's not the only time that's happened either, not by a long shot. Before you make the argument that the bank must be doing a great job if that many people join/stay. People join because it's convenient. There are branches all over the place. I know that's why I joined, but quickly quit when I figured out what they were up to. If enough people took decent service over convenience and quit, maybe they would wise up and change their ways.

Ok Chris, fine, this is America; we've got a freedom of speech thing here. Rant if you want. But, you asked why I'm on ROR's about USB all of the time. Well, I'm a USB customer and have been for 8 years or so. I like to keep tabs on companies that I work with. I also blog on my health insurance carriers ROR's too. So do you think I work for them and USB?

Chris, the fact remains that 99.99% of overdrafts are due to customer error. USB offers many forms of overdraft protection at little or no cost. Personally, I have a small credit line attached to my checking account that costs me nothing unless I have to use it. Then it's like .12 a day for every $100 I borrow. That arrangement sounds fair to me.

As for funds availability, USB offers an 800 number, a website, ATM's, text and email alerts that alert you to your balance so the "no one told me" bit doesn't really work anymore.

Bottom line: With all this information, there's no excuse for overdrafting.

if the overdraft fees are part of some far reaching bank conspiracy, then why do the vast majority of account holders not pay overdraft fees? A large part of the change is that people used to be able to 'live on the float'. They could pay by check and then have a couple of days to deposit the money to cover it. However, with Check 21 and the advance in technology that the banks use if try to 'live on the float' these days you are going to lose and pay overdraft fees. As far as the education to avoid overdraft fees, Edgeman, I Am The Law, Robert, John and several others quite plainly tell the way it is: make sure the money is available in your account before you spend it. If you follow that you won't have any overdraft fees. And no I do not work for US Bank.

All you people are doing is regurgitating all the things that have already been spewed. I've already heard it all. If you want to respond, respond to the points that have not been addressed by anyone. Why have I only had this problem with US Bank and not the numerous others I've belonged to? Why have the bank employees (and even the manager) not been able to explain how I got overdraft fees even with the statement right in front of them? By the way, even though they couldn't explain it they wouldn't reverse the fees. If all of you have had great experiences with this bank, good for you, but it's extremely naïve to assume that because things are fine for you, they should be fine for everyone.

“Personally, I have a small credit line attached to my checking account that costs me nothing unless I have to use it.”

You just basically admitted that have no experience with how their overdraft system works. If it doesn't apply to you, how can you make assumptions about other peoples' irresponsibility?

"As for funds availability, USB offers an 800 number, a website, ATM's, text and email alerts that alert you to your balance so the 'no one told me' bit doesn't really work anymore."

Firstly, I never said "no one told me". The problem is none of these methods are accurate. I don't know if they intentionally made these to be misleading to encourage overdrafting or they just don't work, but the bottom line is they are waste of time. I've tried all the methods you mentioned and all them seem to conflict with each other and the available balance never seems to be the actual available balance. All I ask from my bank is that it be truthful. The rest is my responsibility. I assume you're going to say that I should keep a check registry. I do, but if all these other methods aren't accurate, why do they exist? They might as well just come right out and say they don't work. That way people wouldn't waste their time. Also, I never once said there was some far-reaching bank conspiracy. That's idiotic. I'm simply saying this bank uses unethical tactics in order to squeeze as much money from people who are struggling. I never once said anything more than that. In you peoples' opinion the bank has never done anything wrong and everyone on this site is simply irresponsible. In some cases, you're right, but not even close to all of them. I have experienced their tactics first hand with my account and other responsible peoples' accounts so simply saying everyone is irresponsible or in "I am the law"'s case, essentially calling people stupid, doesn't fly.

I have never been charged any overdraft fees from my bank...
I am not rich... I use my debit card all the time... my bank reorders transactions...
Come to think of it, I still wouldn't be charged a fee if my account were to drop to 10 cents!!!
You want in on the secret?

I use a transaction register and write down every single transaction that I conduct!!

Just in case hell happens to freeze over, and I do overdraft my account,
I have FREE overdraft protection linked to my savings account!!
I will never be charged a $35 idiot fee per transaction. Never.

You say there's no conspiracy and yet you insist that their unethical practices take money. Their practices are the same for all account holders. If they are indulginf in unethical practices that cause people to overdraft then each and every account holder would be experiencing these overdrafts. The fact is that a very small percentage of account holders have overdraft fees so the catalyst for these fees must be something these people are doing or not doing (such as keeping an accurate check register) and not something the bank is doing.

Yes, you can make the argument that if they are truly using unethical tactics, then it stands to reason that it should be happening to everyone. The trouble with that is, I know what I've experienced and just because it hasn't happened to everyone, doesn't mean it hasn't happened. I also know several people that have seen it first hand as well. When I make a debit transaction the Saturday after my Friday direct deposit becomes available, and it shows up in my account activity as being posted on Thursday, before the funds were available and giving me an overdraft fee, I have a problem with that and I'm sure most people would agree.

So Chris, have you ever thought about just closing your account and going somewhere else? I mean, if I thought someone was constantly ripping me off, I wouldn't do business with them.

In addition to the question from I am the Law.

You have mentioned your situation with your Direct Deposit coming in on Friday, making a purchase on Saturday, and them actually back-posting the Debit to Thursday. So if you have the receipts showing the real date of the purchase, and the bank statements that show they moved those same purchases back to cause overdraft fees, why have you not brought this "smoking gun" to court and the media?

"So Chris, have you ever thought about just closing your account and going somewhere else? I mean, if I thought someone was constantly ripping me off, I wouldn't do business with them."

I have done this. All my complaints are from at least 6 months in the past. I haven't had any problems with my new bank.

These people all have an interest of some kind to refute your valid claims. Since when does someone care enough about a multi-million corporation to take the (frequent) time to defend "cooking the books" ? See the lawsuit (class action suit) . USBank has many more people on their payroll (one way or another) to shoot down the people who post here. Money is powerful. but, do not be discouraged. Many, many people are listening to you. The laws regarding this WILL change ! The few banks taking advantage of this (mainly among poor people) will be stopped. It will happen under the Obama administration. Keep the faith. You, like the slaves from Africa, will soon be liberated !