Should Bank of America be sued over their overdraft policy?

Question

Bank of America has a overdraft policy where they deduct funds out of your account by the size of the charge and not the order they actually came in. So, let's say you make 3 purchases in one day using your debit card(but you charge it as credit) for the amounts of 10$, $4 and $3. Let's also say you have only $7 in your account. So instead of doing what makes sense, taking out the $4 & $3 before the $10 (which would generate only one overdraft fee); they instead take out the $10 first (which ends up generating 2 overdraft fees).
I contacted a Bank of America representative about this to ask for a refund (which of course was denied) then I told him I was going to make a complaint to the BBB, to only be told filing a complaint with them would be pointless. Well, I did, and I ended up getting my overdraft fees refunded. Bank of America sent back a fancy response to me about overdrafts, but not once in that letter did they answer my questions about overdrafts. Should they be sued?

I understand how the banking process works and with how merchants submit their charges to the bank. So, if all possible items that you have submitted go through, what is the point of charging biggest one first and the smaller transactions later if they are going to cover each charge anyway? You can't tell me with today's technology that their computer system can't figure out a simple equation like that. Another interesting bit of information is that Bank of America makes more revenue doing fee(s) than they do in any other sector of their business.

Answer 1

NEWS FLASH!! All banks process the largest checks first. The theory is that the larger amounts are more important. Would you want your mortgage payment to bounce over a $10 check?

Basically you failed to keep proper records of your transactions. You should keep a check register and post all those debit card transactions. That way you will know what you have in the bank.

Also, set a figure you don't go below. When you hit that mark, don't use the debit card and don't write checks.

Oh, what are you going to sue them for? You even got your NSF fees refunded. Where are your damages?

Answer 2

NO. There policy may or may not be fair, but it IS what YOU agreed to. ALL overdraft fees are 100% avoidable. Most banks use the same policy and they ALL spell out what order debits will post.

I doubt Alan B is actually a banker. If he were he should know the order the charges are received by the bank makes ZERO difference. ALL charges received in a single business day are posted larges to smallest at the end of the day. The computer neither knows nor cares about the order.

Answer 3

Maybe, But not for this.

Just because you spent the money in that order does not mean that, that is the way the bank received your charges. Say you spent the money at store A for $3 then went to store B and spent $4 then later went to store C and spent $10. Well with out know everything about banking you would guess that those charges would be processed as they were being done. Well that is not exactly what happens.

Stores debit the account instantly only if you use the debit option. When using the Credit option things get tricky. The stores send in Batches of Credits to be run through Visa or Master card. They send these batches into "Visa" and visa later sends them to your bank to be drawn against your account.

So if Store C batches first for $10 at mid night then, Then Store A batches at 2am for $3, Then Store B batches at 3am for $4 you could be over drawn 3 times, due to fees.

I hope this explains things a little better.
Sorry they make things so confusing.

The credit option though more complex is safer and help protect against fraud and identity theft.

Answer 4

Absolutely not, first almost every bank post items high to low to pay the most expensive purchases first and lower items last. Second the bank has the right to REFUSE any of your purchases when you do not have the money to pay them and still charge you a non sufficient funds fee.

What if it was your car insurance that needed to be paid and the bank paid your mc donalds purchases and gas stations and let your car insurance go back NSF because they paid all your little purchases first that you had the money for, then you car insurance would be canceled, you could get pulled over and your car impounded. That would cost you alot more then some 30 dollar overdraft fees.

And lastly when you signed up for that account all that kind of information is given to the customer and they are responsible for reading it. Not only that when you open a bank account you agree to the contract and so you agreed to the high to low payment of items.

Answer 5

if you were only $0.01 off in your calculations could cost you $35 for every transaction after posted with the largest one WRONG. If you were only $0.01 off, there would only be ONE transaction that over-drafted, and it would STILL be 100% YOUR fault. I started with a low balance (say around $20), but deposited $1200 in cash and scanned checks at an ATM after midnight; The notice on the machine SPECIFICALLY stated the deposit WOULD NOT post until the next business day. Even if the transactions were posted in the order you list, the $12 at the bar is the ONLY one that would not have over-drafted your account. I was charged every month from Nov 2008 until June 2011 before I figured out why. If you took 32 months to notice ANY monthly charge, YOU are the problem. I never go 2 WEEKS without checking EVERY transaction against MY records. PS: Precisely because there has ALREADY been a class action lawsuit on the issue, and you did not take steps to be excluded from the class, you have forfeit any right to sue on this issue.

Answer 6

I think they should have a class action lawsuit personally. There are many posts and web sites on this on the internet, but it looks like none of them gained steam, most likely because when opening a account with BoA, they have their butts covered when you signed to agree to their terms.