An Illinois teenager and his mother learned their lessons with bank fees the hard way. In a recent story in the Chicago Tribune, Jon Yates reported that 18-year-old Daniel Ganziano managed to rack up nearly $230 worth of fees in a matter of days at TCF Bank. The catch: he wasn't even spending money.
Here's a breakdown of how a positive balance of $4.85 paved the way to a whopping negative value of $229.10.
- The teen's bank account balance fell to just $4.85, and TCF charged him $9.95 for failing to meet a minimum balance.
- This charge caused the account to be overdrawn, which led to additional charges of $28 each day for nearly two weeks.
While fees for overdrawing a checking account or making excessive withdrawals typically show up in an account holder's online statement, this type of story makes me wonder when banks will be forced to take a proactive approach to fee awareness. Of course, I believe account holders should be held accountable for their spending and saving habits, but what about a system that triggers an automated email or phone call once a checking account holder crosses a certain threshold of additional charges? In the barrage of customer service complaints and sub-par customer satisfaction survey results, it seems that this small step would help banks and their customers.
Now, readers might argue some members of the banking industry would love to watch fees pile up for delinquent account holders, but in the end, I think this really only hurts both parties. Account holders wind up in the hole, and I'm sure banks wind up with plenty of customers who can't pay for the charges. In the case of TCF, the institution now has a public relations headache on their hands. The article makes TCF employees initially seem less-than-helpful when the teen's mother attempted to reverse the charges. Who wins?
This seems like an issue the Consumer Financial Protection Bureau should address. Of course, that agency seems to be facing some hurdles.
What do you think? Should banks be required to notify account holders of additional charges before they pile up too high?