• Report: #964964

Complaint Review: Higher One

  • Submitted: Mon, November 05, 2012
  • Updated: Tue, November 06, 2012

  • Reported By: cortney — gainesville Florida United States of America
Higher One
115 munson street new haven, Connecticut United States of America

Higher One Financial Aid Scam new haven, Connecticut

*Author of original report: how is it legal?

*Author of original report: YOU do not have an option

*UPDATE Employee: Additional Info from Higher One

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So ive heard all of the horror stories about Higher One scamming students out of their financial aid. If you havent, you should read this, especially if youre a future user of higher one or have financial aid. My school, Santa Fe College of Gainesville Florida, has decided to use Higher One to handle Financial Aid. When getting awarded financial aid, you would assume to get a check for your refunded money, not used for text books and tuition. However, long gone are the days of getting a simple check. Now you have NO CHOICE but to sign up for a higher one bank account. Higher one offers a few options for the student who realizes that having their federal financial aid loans that they are having to pay interest on go into a bank account that they really have no control over is a bad idea. 

One option is for the student to sign up for their money to go into their personal bank account. This has to be done by first signing up with higher one (theres no way around signing up for the bank account, whether you want it or not). Afterwards, the money goes to higher one THEN goes to your bank. This process takes days, sometimes weeks to complete. And even then, you really didnt have the option of your money not being in some sort of bank account, you just simply transferred it to another one.  

The second option is to have a check mailed to you from who else but higher one. Also, not giving you any option but to set up a bank account that cant be closed as long as youre receiving financial aid. This check, although higher one claims it shouldnt take longer than a few days, takes up to a month to get to you. Thats a month you have to go without paying rent, gas for school, food, amenities to live, and so on. 

Should you choose to stay with higher one, which is conveniently the quickest method of receiving your refund, heres what you get to deal with. Half of which really seems illegal. 

Higher One charges you a fee for inactivity. Want to save your money? Dont have any reason to use it? Need it for next months rent? Yeah, you better find a way to use it or they will charge you. Higher one also charges a nearly 3 dollar fee for using ATM's that arent theirs (not including the fee the ATM alone charges you). I researched what ATMS's are near me. Theres ONE, and its inside the school. Half of the time, its out of service, not to mention, I take online classes because im no where near my schools campus. But wait. Theres more. They also charge fees for using a pin. They even try to talk you into using your card as credit so you wont be charged fees. 

Heres the thing about the pin number fees. Number one. I would much rather use a pin number, because its really easy for anyone to get ahold of my card and just sign away purchases that arent mine. Number two, every time you use your card for credit, it can take days, weeks even for the correct amount to be billed to your account. So when you over draft your account, because higher one failed to post what youve used on your bank statement (which is only located online, and is constantly not available, and when it is, is so simple and lacking of detail that anyone could easily be confused on whats what because it all looks the same) they charge you 50 dollars or more for a late fee of any amount of over draft after 30 days. Why go 30 days without paying whats gone in the red you ask? Oh, its because the only way to PUT MONEY on your account is through your scheduled refund of financial aid, or by mailing them money or by harassing family members to put money in your account with their credit cards. The last option to repay by the way, it mentioned to you several times in emails sent to you by higher one. 

There are also limits on how much you can spend in one day of your own money. Not higher ones money. It isnt a credit card, so why are their spending limits? Imagine my disappointment of trying to move into my apartment when i couldnt pay move in fees and first and last months rent because it was more than the allotted amount higher one will let me spend. I tried getting ahold of their customer service department. Number one, it took an HOUR to get ahold of someone, and when I did, they had no idea how to help me. Thanks customer service. 

Speaking of customer service. My account was over drawn by 10 dollars (which doesnt seem so bad, untill they charge you 50 bucks for it. Which again, comes out of your financial aid). There was no where on my bank statement that said i spent over that much, except for the actual amount that was lacking in my account. I read through every payment i had made, and it still never added up to negative 10 dollars. So I called customer service and after talking to 3 people, and being on the phone for 2 hours, they never could tell me why it was overdrawn. There simple answer was "well, just trust us. Its over drawn. You cant see why. But its there". In the end, I had to pay them 60 bucks from my next refund even though they never could tell me how or why my account was over drawn. 

So, basically. Im not entirely sure, and would like to know, how is it legal to force students who have financial aid to open a bank account. Im pretty sure its not legal, under any circumstance to force someone into having a bank account. That directly effects my credit. I also dont understand how it could be legal for a company to make money off of, and take money out of my financial aid. I dont see how they can pay themselves thees fees they take out, with my federal financial aid that im paying interest on. That money is for school, not for paying bank fees. All in all, ive had 300 dollars taken out of my financial aid and paid to higher one because of fees they charge. All without a choice. Thats 300 dollars of my loan money, just taken away. 

This report was posted on Ripoff Report on 11/05/2012 12:14 PM and is a permanent record located here: http://www.ripoffreport.com/r/Higher-One/new-haven-Connecticut-/Higher-One-Financial-Aid-Scam-new-haven-Connecticut-964964. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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Updates & Rebuttals

#1 Author of original report

how is it legal?

AUTHOR: cortney - (United States of America)

Also, you didnt answer how its legal for higher one to make money off of my federal financial aid loans for school? Thats money being taken away from me. Also, I myself, and a few other friends, have previously chosen the check by mail option, and it does NOT take only a week. It takes a MONTH to recieve the check. Even the schools web site says it takes this long.
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#2 Author of original report

YOU do not have an option

AUTHOR: cortney - (United States of America)

You contradicted yourself. You said we have the choice to choose. But we dont. When you get your higher one card, you HAVE to activate it, in order to do anything. And the money never goes straight from the school or funding source to your bank account, Higher One is still the middle man. Regardless of whatever refund option you choose, Higher One has access to your money one way or another. To thats not true is a lie to customers.
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#3 UPDATE Employee

Additional Info from Higher One

AUTHOR: Aaron, Higher One - (USA)

Hello! My name is Aaron and I work with Higher One. It seems there is some miscommunication and misunderstanding about how our refund process and system works. I would like to help clear this up for you. We are actually all about choice, and is one of the primary reasons your school decided to partner with Higher One - to offer additional choices to in how to receive your refund money. 

First - you are correct that there are multiple options to receive your refund from the school. However, you are incorrect in that you are required to set up a checking account with Higher One. Students are never required to open a checking account with Higher One, it is merely one of the options offered. The card you receive in the mail is not an active debit card when it arrives. Rather, it is a piece of plastic used to identify the person who received it and a means to select how you'd like to receive your refunds from the school. During the refund selection process, students are shown all the options for refund delivery and it is at this time where a person would select to open a checking account with Higher One. However, it is also where a student would select to have the money directly deposited into an existing bank account, or receive a paper check in the mail if that option is available (the check option varies by school).

If a person elects to have their refund directly deposited into an existing bank account, or have a check mailed, there is absolutely no banking account relationship created with Higher One. We simply ask you to provide the bank information of where you'd like the money to be deposited, print a form which you then sign and submit to Higher One. We require your signature on file to both ensure the money is being deposited to the right account, and so we have your permission to do so. If a person select this option, it takes between 2-3 business days from the time Higher One receives the full refund information from the school for the deposit to show up in the third party account - this is due to the Automated Clearing House processing times, and not because Higher One is holding the refund. Likewise, if a person selects to receive their paycheck via a paper check, there is absolutely no banking relationship created with Higher One. It also only takes 5-7 business days from the time Higher One receives the full refund information from the school for the check to arrive in the mail - not weeks. You can learn all about the refund process here: https://www.higheroneaccount.com/easyhelp/pta?basepage=answer&type=public&param=2145

However, should someone choose to open a Higher One account, and then change their mind and wish to change their refund preference, this can be done at any time, 100% free. Here is information from Easy Help on how that is done. https://www.higheroneaccount.com/easyhelp/pta?basepage=answer&type=public&param=2153 

Regarding the fees you mentioned. First, the PIN Transaction fee is easily avoidable by selecting "credit" and signing the receipt or screen. Not only is this transaction free, but it also covers you under MasterCard's Zero Liability Protection Policy - something using your PIN does not come with. The non-Higher One ATM transaction fee is a fee charged by many banks and is in line with what they charge - this is not uncommon. We do have account options which offer non-Higher One ATM reimbursements for students who wish to open them. Lastly, if a Higher One ATM is not operational Higher One will refund fees charged by other banks of up to $5.00 per day. You can learn about our ATM Commitment Policy at this Easy Help link: https://www.higheroneaccount.com/easyhelp/pta?basepage=answer&type=public&param=2466

Spending limits are in place for your security and is also something that many other banking institutions enforce. However, should you need access to more than they allowable daily limit, Customer Care can increase those for you. Additionally, we have many ways to make deposits into the account other than Financial Aid refunds - you can see all of them here: http://myonemoney.com/value/deposit-options

Lastly, the abandon account fee is actually something that will be going away before the end of 2012 based on Customer feedback. Even though it was only charged to a very small number of customers, and we also contact customers informing them they are in danger of receiving this fee, we are listening and have decided to remove this fee.

We hope this information has been helpful! You can find many answers to your questions through Easy Help at any of the links above. 
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