Check Card Dirty Little Secret

I am "madder than hell and not going to take it any more!" (Network, Albert Finney) I have encouraged my 87 year old mother to use her check (debit) card rather than credit cards for most purchases. She doesn't purchase much, but does use her card at the grocery store, drug store, Walmart, Lowes and a few others.

I "manage" her bills online with Bank of America. Whow! I logged on over the weekend only to see 13 -- YES -- 13 overdraft charges at $35 each over a 10 day period. That is $455 in overdraft charges.

Yes, her account was overdrawn. Yes, I guess I should be checking her account online every day -- maybe twice per day!!! Yes, this practice is predatory and relates only to check cards.

This is how the little game works: Bank of America says that it is VISA's fault. They don't check balances on check cards so they allow virtually all check card charges to go through. Unless you go to a teller machine, you don't ever see a balance at the grocery store or anywhere else. If you don't check your balances daily (what 87 year-old does?) you get dinged $35 each and every time you use your card. With credit cards, your charge is denied, so you never pay an overdraft charge.

Now I understand why banks are encouraging people to use their check-cards. On WRAL the other night they had a story of a young soldier in Iraq who was dinged $1,750 in one month by Bank of America. He was buying cigarettes, lunch, groceries, etc.; and most of his charges were under $20, but each one dinged him for $35. This is an ugley little secret.

I don't think Bank of America is the only bank doing this. It is outrageous! It is predatory. It must be changed.

#1 Don't use your checkcards unless you are absolutely certain you have the balance to cover the charge.
#2 Set up overdraft protection (this will only cost you $10 per overdraft -- UGH! I am sure it might c0st the banks of of $0.01 per transaction to transfer funds from savings to checking. (My mother had plenty of money in her savings account.)
#3 Call you congressman and tell them this must be stopped.
#4 Call Obama and say this must be part of bank reform.
#5 If you see these charges, argue hard with your banker. You may get something back.

This is an ugley secret of banking. My own Suntrust banker told me she sees poor people using check cards to buy groceries, knowing full-well that they don't have the balance in their account to cover the charge, but they desperately need the groceries, so they accept the notion that they will be charged an extra $35.00. Ridiculous. You can't tell me that bastard VISA can't determine when to deny a charge. There is simply too much data available out there. This is predatory and must be stopped.

Your suggestions? Share your stories. Write your congressman. Tweet. Make Youtube videos about it.

Just imagine for one moment the amount of money the banks are making on this predatory practice: just imagine!!! And we bailed them out?