Banks flout federal laws on fees, GAO says

[lovuian]

f bank fees are a mystery to you, you're not alone. Government investigators dispatched by Congress last year to find fee schedules at banks around the country came back empty-handed 22 percent of the time. And at one-third of the banks, information on overdraft fees and procedures was nowhere to be found.

The Government Accountability Office study, which was released Monday, concluded that consumers lack the most basic information to "comparison shop" when selecting banks.

Lack of a clear and conspicuous fee schedule violates the 1991 Truth in Savings Act and Federal Reserve Regulation DD. But while banking regulators cited firms for ignoring fee disclosure rules 1,674 times between 2002 and 2006, the GAO found that significant consequences for violations are rare. Only twice did regulators undertake formal enforcement actions.

In other words, it's far more likely that you'll get a parking ticket for breaking parking rules outside a bank than it is the bank will be fined for disobeying federal lending laws.

While the fees may be a carefully guarded secret, their consequences are obvious. Last year, banks grabbed $36 billion out of depositors' accounts in fees, the GAO said. Fees are up 11 percent since 2000, and are becoming an ever more important part of bank business, accounting for 27 percent of banks’ "non-interest income" last year, up from 24 percent in 2001, the report said.

http://www.gao.gov/new.items/d08281.pdf

more...

These Banks are CROOKS

[malaise]

1. Crooks is too mild

They're robber barons.

[shraby]

2. That's what happens when the banks were given

permission to merge across state lines.

[Warpy]

3. Megabanks make their real money on corporate accounts

and the only way they think they're seeing a profit on personal accounts is by charging these ridiculous fees.

A better idea for folks on the edge who have to face these fees is an account at a local credit union or a small bank that hasn't been swallowed up yet.

[ixion]

4. and now they're begging for a bail out

I say, let'em drown. :grr: