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American Banks: examples of how badly they suck





quex
Calling all people who share the name Konstantinos Alexopoulos, if you open an account with Bank of America, you too can get $59,000 of someone else's money for free.

Now how common can that name really be in the USA? Apparently common enough for a major mistake. And if you think one innocent mistake is forgivable enough, how about these?

Quote:

The bank gave the same 10-digit account number to two customers in Riverside, California, according to a July report by the Los Angeles Times. One of the customers -- an 88-year old World War II veteran -- ended up losing out on $30,000 worth of social security payments as a result. After an investigation by the San Bernardino County district attorney's office, he ultimately got the money back.

In September it was reported that a Hawaiian woman sued BofA after she received computer-generated calls as often as every 15 minutes from the bank over a missed mortgage payment, while she was grieving for her recently deceased husband.

BofA has also had some notable blunders issuing foreclosures. The bank threatened to foreclose on a Utah couple's home earlier this month, after they had already sold it. The bank also tried to foreclose on a home last month that was destroyed by Hurricane Ike in 2008. In addition, the bank asked a Massachusetts man in August to pay a $0.00 balance to stave off foreclosure.


You can even be sent to jail for trying to cash a check... an official check, issued by the very same bank at which you are trying to cash it.

This is (partly) why there is a massive protest going on in hundreds of cities across the USA against big banks and Wall Street profiteers. How is it where you live?
ocalhoun
Aw, you forgot the one where they foreclosed on the (paid off) house of a person who never had any kind of account with them.

...Or the one where they somehow convinced the local police that they needed to send in a SWAT team to do the foreclosure.
quex
ocalhoun wrote:
Aw, you forgot the one where they foreclosed on the (paid off) house of a person who never had any kind of account with them.

...Or the one where they somehow convinced the local police that they needed to send in a SWAT team to do the foreclosure.


Jaysus Krist, seriously? I've missed both of those. Any idea how long ago and whereabouts they were?

I've heard of repo men getting the wrong car, but not the bank foreclosing on the wrong house. O.O
ocalhoun
quex wrote:
Any idea how long ago and whereabouts they were?

Sorry, I just remember reading the news reports, but I don't remember any details.
Quote:

I've heard of repo men getting the wrong car, but not the bank foreclosing on the wrong house. O.O

I think in that case, if I remember right, the case was that the house's previous owner was a BofA customer who sold the house to another person.
BofA screwed up the paperwork though, in such a way that they still expected to be receiving payments on it.
liljp617
ocalhoun
*looks at image above*

Really... I know black looks cool and all... but are you trying to look like 'the evil empire'?
Those guys look to be one step away from being the classic 'bad guy grunts' from a low-budget sci-fi film.
(Just darkly tint the visors and make the armor shinier... that should do it.)


Also, needs a caption... I nominate:
"This is what's wrong with America" or "Know your enemy"
quex
liljp617 wrote:


O.O

G*D-D*MN.

Supremely fine image of current events. Take that one yourself? :D
Nameless
ocalhoun wrote:
Also, needs a caption...

"Tango Six calling Alpha One. You, uh, you did say the riot was on the 6th avenue ... right?"

or

"Oh no, don't tell me you're wearing the same outfit as well! This is so embarrasing."

or

"Alright bitches, who wants to cut in queue now?!"
liljp617
quex wrote:
liljp617 wrote:
*image*


O.O

G*D-D*MN.

Supremely fine image of current events. Take that one yourself? Very Happy


No Razz Can't recall where I found it. Reddit maybe?
quex
....aaaaand here's an example of how banks COULD be doing things:

Members of Veridian Credit Union are behind random acts of kindness

These are called Credit Unions. They are essentially local banks, and most Americans ignore them in favor of massive nationwide banks. This used to be because the national banks offered higher rates of return on interest and CD accounts, but the rates have been essentially equal between all banking entities since the economic crisis began. Now it's because... well, national banks are just advertising more. If you live in the USA, think about the last time you watched TV. Did you see an ad for a national bank's services or a credit card? Think about how often you see those types of commercials. They are second in frequency-of-exposure only to car commercials... in some areas, they are the MOST frequent topics of advertising.

We're being brainwashed into giving our money to profiteers for safekeeping, rather than keeping it in our own community.
ocalhoun
quex wrote:

These are called Credit Unions.

+1 on the credit unions.
I'll use big banks for credit cards... they do have better rewards programs and better online payment/account control...
But for any actual banking... savings, checking, loans... I always go to a local credit union.
They know they can't compete with the big banks' advertising, so they actually to earn your business through things like good customer service.
_AVG_
ocalhoun wrote:
quex wrote:

These are called Credit Unions.

+1 on the credit unions.
I'll use big banks for credit cards... they do have better rewards programs and better online payment/account control...
But for any actual banking... savings, checking, loans... I always go to a local credit union.
They know they can't compete with the big banks' advertising, so they actually to earn your business through things like good customer service.


I agree there. A trip to the Local Credit Union is generally faster (since there's usually no long queue), a lot more pleasant, and the processes are much easier (at least for the average customer).
Even for the debit cards, the only major difference I find is that while traveling, you get charged too many ATM fees if you use the Credit Union's debit card. Otherwise, for small online payments, there's no difference really (or you can also use PayPal!).
quex
Aaaand if anyone is still interested, another case of US banks screwing over a customer. In this case it's a TCF Bank in the state of Illinois.

Let's recap the math:

Account is in the black, $4.85. A positive balance.

Bank charges him $9.95 fee for "maintenance", because the balance is so low. (What maintenance, exactly? Did someone have to go into the vault and count the $4.85 or something?)

Now the account is overdrawn by $5.10.

Bank charges an overdraft fee of $28 EVERY DAY. What the hell? This is an inactive account... it's not like the kid is charging anything to it. But no, 28 bucks a day.

By the time the family realizes anything is wrong, they owe $229.10. This is all without the owner of the account spending anything that wasn't his own money. The bank essentially claimed the last of his money, $4.85, and then charged him more than $200 for the privilege of having an empty account at their bank.

Seriously, wtf?
Afaceinthematrix
quex wrote:
Aaaand if anyone is still interested, another case of US banks screwing over a customer. In this case it's a TCF Bank in the state of Illinois.

Let's recap the math:

Account is in the black, $4.85. A positive balance.

Bank charges him $9.95 fee for "maintenance", because the balance is so low. (What maintenance, exactly? Did someone have to go into the vault and count the $4.85 or something?)

Now the account is overdrawn by $5.10.

Bank charges an overdraft fee of $28 EVERY DAY. What the hell? This is an inactive account... it's not like the kid is charging anything to it. But no, 28 bucks a day.

By the time the family realizes anything is wrong, they owe $229.10. This is all without the owner of the account spending anything that wasn't his own money. The bank essentially claimed the last of his money, $4.85, and then charged him more than $200 for the privilege of having an empty account at their bank.

Seriously, wtf?


That isn't exactly unusual. That's common among banks. It does cost them a little money in paperwork and such for you to have an account. For them to make money off of you, you need to have some money in the account. Therefore, there is often a fee to have an account if you do not have some minimum amount in there. It's all a part of the paperwork that you have to sign to create an account anyways. You should know that before signing up with the bank because you probably signed for it. Although most people are too stupid to actually bother going through and reading the paperwork they sign.

On a side note, are those boots that the officers are wearing or are they some type of shin pads? Because they look cool and I wouldn't mind getting myself a pair.
ocalhoun
Afaceinthematrix wrote:


That isn't exactly unusual. That's common among banks. It does cost them a little money in paperwork and such for you to have an account. For them to make money off of you, you need to have some money in the account. Therefore, there is often a fee to have an account if you do not have some minimum amount in there. It's all a part of the paperwork that you have to sign to create an account anyways. You should know that before signing up with the bank because you probably signed for it. Although most people are too stupid to actually bother going through and reading the paperwork they sign.

I'm a member of 3 credit unions.
All of them have no minimum balance, and charge overdraft fees per transaction not per day.

Yes, it costs the bank some money to keep your account open.
No, it doesn't cost them $5/mo. A few pennies maybe.
Even for an amount as low as $4, the interest on that should be enough to cover the overhead for maintaining a dormant account.
Quote:

On a side note, are those boots that the officers are wearing or are they some type of shin pads? Because they look cool and I wouldn't mind getting myself a pair.

Looks like shin pads/instep protectors.

Actually, I kinda want some too. They would be awesome for caving, assuming they don't tend to accumulate grit in the top.
quex
Afaceinthematrix wrote:


That isn't exactly unusual. That's common among banks.


...where the hell do you bank? I have been through four different banks in the past five years (I move around a lot), and not one of them had a minimum for a standard savings or checking account before incurring a fee. If you have some fancy high-yield thing, then maybe, but in those cases, the minimum is usually in the tens of thousands. Something you would be made well aware of.

Quote:
It does cost them a little money in paperwork and such for you to have an account.


Not if it's that small. Paperwork actually only becomes a financial burden for larger accounts, when reporting them to the IRS is a matter of legal protection. What the hell kind of paperwork do they need to do for a paltry amount like $5? That's managed entirely by computers, thousands of accounts at a time.

Quote:
For them to make money off of you, you need to have some money in the account. Therefore, there is often a fee to have an account if you do not have some minimum amount in there.


Are they losing any money on you by holding your small change in an inactive account? No. It just sits there. As a matter of fact, because the capital of an financial institution of the size and ilk of TCF Bank is maintained in a digital format ANYWAYS, those nickles and dimes aren't even taking up real-world vault space. They're a few bits of data in a server. The bank can still earn fractions of pennies off of that small amount, too. That's how combinatory investing works.

Quote:
It's all a part of the paperwork that you have to sign to create an account anyways. You should know that before signing up with the bank because you probably signed for it. Although most people are too stupid to actually bother going through and reading the paperwork they sign.


How long have you had your current financial accounts? How many times have the user agreements of those accounts changed? I'll bet I can find three clauses in any one of your financial agreements with a major institution that you are not aware of, no matter how carefully you read the fine print. I agree that reading through is important, but bringing along a magnifying glass and getting all the tiny text into your brain is not a fool-proof shield against unexpected fees.

For example, I once opened a checking and savings pair with Wells Fargo. Then I opened a second savings account to manage a club's funds as treasurer, not connected to the accounts I already had. None of the paperwork on any of these accounts said anything about a fee, but sure enough, I started getting charged $12 a month. Why? I asked the bank. "We noticed that you had gotten a pair of accounts with us the first time you came in, so when we opened your second savings, we opened a second checking account, too. The charge is for inactivity because it's empty." So I was being charged for an account I didn't want nor knew I had been assigned, the small print of which I was never given to read because I didn't even authorize it's creation. I informed the bank I did not want that second checking account, and they told me I would have to come back to speak with a personal finance manager to have it closed. The meeting with the personal finance manager incurred a charge of $24, which I was fortunately able to get waived after 30 minutes on the phone with the manager of the billing department at HQ.

Am I at fault for not anticipating that the bank would make an error in its favor? That they would open an unauthorized account in my name? One of the only ways I was able to have them cancel these fees was to point out that as I had not signed my name to anything to open the checking account, it was illegal for them to have established it in my name. They hadn't really been interested in canceling the charges before that point came up in conversation.

Quote:
On a side note, are those boots that the officers are wearing or are they some type of shin pads? Because they look cool and I wouldn't mind getting myself a pair.


I like your fashion sense. ;D
quex
ocalhoun wrote:
They would be awesome for caving, assuming they don't tend to accumulate grit in the top.


You like caving? :3 Ever been to Arizona? I just got to visit Kartchner caverns for the first time; effing SWEET.
playhouse
watch the movie 'inside job'
shocking greed
quex
playhouse wrote:
watch the movie 'inside job'
shocking greed


Thank you; I think I will. :3

In other news, at least ONE of the major sins of SOME US banks is being addressed with a major settlement this week: Wells Fargo, Bank of America, Others Agree to $26 Billion Bank Foreclosure Settlement

Sounds like a lot of money, but the hitch is, many people who lost their homes to the fraud and errors of the foreclosure process as practiced by unscrupulous loan officers will only get $1,800 out of the settlement. That's about ONE mortgage payment (as in one month out of 12) for the average American family home.
ocalhoun
And that brings up another problem... Often banks (and other big corporations) get hit with big settlements or fines... that sound really big... But, many of those times, the lawsuit/fine costs them less than the profit they made doing their unscrupulous activity.
...And when the cost of getting caught is less than the profit of doing the crime, they'll have no motive to avoid it in the future.

Math time!

The penalty for a corporation caught doing some kind of illegal/fraudulent act should be at least:
(The amount of money they gained from it) x [inverse of (odds of them getting caught doing it)]
So, if they made $30 billion by doing fraudulent activities, and the odds of them getting caught were 1/50... The magic number would be:
$30G x inverse(1/50)
$30G x 50/1
which is:
$1,500G: $1.5 trillion.
Only by making the fine/lawsuit payout greater than that number will you make it unprofitable for them to continue their nefarious ways... And only then will they even consider stopping.
(Yes, I'm saying that in the example given, fines lower than $1.5 trillion would fail to make the criminal activity unprofitable. ... And that money would go a long way towards undoing the damage of their fraud.)

quex wrote:
$1,800 [...] That's about ONE mortgage payment (as in one month out of 12) for the average American family home.


...That would have kept me in my old house for about 3 months... and the one I'm in now for a year and a half...

Never been so happy before to be below average. ^.^
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