Bank of America — overdraft fees charged to accounts with positive balances
Copy of letter to OCC:
Bank of America charges overdraft fees on accounts with a positive balance by debiting them when checks are issued via online banking rather than when they are cashed.
A check for $4,400 was inadvertently sent from the wrong account with a balance of $3,000 on BofA online banking. Four small checks were posted following this. Discovering the mistake the day the checks were issued I immediately transferred $5000 into the account, then checked with customer service, who indicated that an overdraft fee of $35 would be charged for each check. This is a total of $175.
Contacting the recipients of the checks to make sure that they had been able to cash them, however, I was informed that the checks had neither been received nor cashed, which means that the account has a current real balance of over $8,0000, an excess of more than $3,000 over the written checks.
A second call to Bank of America online Banking Service clarified that checks are debited on issuance rather than when they are cashed (these will be received as paper checks, not electronic transfers. This means that I would be charged overdraft fees of $175 on an account which has never had a negative balance and currently carries a positive balance of $8,000. Nice trick for BofA, but legal?
I have resolved my particular problem with belligerence and acidity, but this is a situation which, if legal, should not be. It's one of several gotcha's in the Bank of America online system. Beware.