Another twist for the unemployed: Debit card fees

[kiva]

If you're out of work like Steve Lippe, who was laid off from his job as a salesman in January, you know you already have problems. But looking at the fine print that came with his new unemployment debit card, he became livid.

"A $1.50 here, a $1.50 there," he said. "Forty cents for a balance inquiry. Fifty cents to have your card denied. Thirty-five cents to have your account accessed by telephone."

He was quoting fees listed in a brochure that goes out to every unemployed person in Pennsylvania who chooses to receive benefits via debit card. He was given the option when he filed for jobless payments: Wait 10 days for a check or get the card immediately. Like most of the 925,000 state residents who received unemployment benefits in February in Pennsylvania, he chose the debit card and only then, he says, did he learn about the fees.

--snip--

The National Consumer Law Center says fees range from 40 cents to a high of $3 per transaction, if the debit card is used at an out-of-network ATM. Most banks give jobless debit card users one free withdrawal per deposit period, which averages every other week in most states. But consumer advocates, including the Law Center, say the unemployed "should be able to obtain cash and perform basic functions with no fees."

http://www.cnn.com/2009/US/03/13/unemployment.fees/index.html?eref=rss_topstories

So states encourage people who are unemployed to choose the debit card then saddle them with fees. :grr:

[tonysam]

1. Let's Kick This Post. It's Too Important a Story

to let it go.

[kiva]

2. I agree, hadn't heard this before. n/t

[BobTheSubgenius]

48. DEFINITELY!

[Ocracoker16]

3. It is outrageous

I recall reading about this several weeks ago here on DU. The banks are extremely greedy to be making people pay all sorts of fees for using the debit cards issued to the unemployed. It is just disgusting.

[OregonBlue]

64. This also applies to Welfare recipients. Those who need the money most.

[liberal N proud]

4. Who's insane idea was it to give them DEBIT cards?

If they wanted to use plastic, the could issue pre-paid credit or cash cards.

[tonysam]

7. Why Would You Want a "Credit" Card if You Are Unemployed?

Debit cards are a GREAT idea for getting UI, but there should not be these fees for withdrawals.

[Gormy Cuss]

16. Government-issued debit cards without fees are a great idea.

Bank issued ones with ANY fees are not.

[liberal N proud]

27. They are prepaid by the government

When the dollar value you are alloted is gone, the card can be refilled if your benefits have not expired.

The charges with "credit" cards vs. debit cards is the fees applied by the grocery stores and other retail outlets that accept debit cards.

Any fees are paid when the card is purchased. In this case by the government.

[INdemo]

55. If withdrawal is made from bank window there are no fees.And a one time balance

check each week there aren't any..So far in Indiana it hasn't changed.

[TahitiNut]

5. "one free withdrawal" ... but they then LIMIT the amount withdrawn.

Thus, the individual's funds are held HOSTAGE. (The God of 'FLOAT' rules!!!)

The games these bastards play. :puke:

(Yes ... I once worked at a bank.)

[tonysam]

8. True. It Depends on the ATM.

Furthermore, these ATM's usually dispense cash only in $20s, so if I want $10, I can't use it.

[kiva]

13. That struck me too.

Part of the reason for urging people to use the card, the article says, is that it's safer than carrying large amounts of cash. Then you only allow one free withdrawal so that people then have to carry cash?

[anigbrowl]

30. Go into the branch. Withdraw cash, deposit in bank or credit union account.

Seems obvious to me. I'm sympathetic to people saddled with this, because some people don't know to read the fine print and end up paying out money they shouldn't...but there's a simple solution.

[Two Americas]

38. oh well gee it's ok then

What were we thinking? Gosh darn the clever people just have all sorts of little tricks to get ahead, and screw the people who are not as clever as we are.

I mean it is not like anyone is unemployed or anything and pinching pennies. It is not as though unemployment was difficult to get, with all sorts of red tape and delayed payments to deal with. It is not as though people are in trouble, and already have too many hoops to jump through, and too few resources, and too much stress as it is. It is not as though people are having trouble keeping their cars going or paying for gas. Just zip around town every time your next payment comes. Don't live near "the branch?" Well, tough.

Naw, it is not as though we were in a crisis or anything. Damned slackers need to get on the program, or they have no one to blame but themselves.

what the hell is the problem with all of these whiners and losers?

WTF does it have to do with not "knowing to read the fine print?"

"Don't get me wrong, I feel sorry for people who are hurting....

BUT..."

But but but but but...

Which is then followed by the same damned arguments the right wingers use.

[liberalhistorian]

It sure as hell isn't a "simple solution" for me.

We don't have a choice in our state as to whether or not to use the damned debit cards and we aren't given the option of direct deposit, either (the state's always been too busy kowtowing and kissing the ass of businesses and could't care less about us little folks). But the bank the state uses for the debit cards has no branches within one hundred miles of me. So it's just not that simple to "go into the bank and withdraw cash." Never mind that it's not even my own bank account, the one I use to pay bills, etc.

[NMDemDist2]

45. except in my town where there is no Bank of America

and that's who New Mexico uses.

the closest BoA to my town is 72 miles one way. so to withdraw cash, I'd have to drive 144 miles. about 8 gallons of gas @ $2.09 a gallon and 3 hours. That's assuming I have a car that I can trust to go that distance.

sweet huh?

[grace0418]

61. In Illinois you don't get one free withdrawal, but they haven't limited the amount.

The stimulus package sent my 2 week total a bit over $700 and I was able to withdraw the full amount.

[donheld]

6. This is maddening

[jaxx]

9. I just sent the link to a friend who get the debit card.

Screwing the public....it never ends.

[FormerDittoHead]

10. They got the ATM's to save money from tellers, then they charged us for the ATMs. What a racket. nt

[OmmmSweetOmmm]

11. Another example of govt. being in cahoots with the banksters.

[Webster Green]

12. That is fucking sick!

Can they just get out all the cash at once? Would they get charged a fee for that? :wtf:

[Odin2005]

14. This is collusion in it's sickest form.

My God, it reads like the corruption and kickbacks of a 3rd World banana republic in Africa or Latin America.

[Froward69]

15. I noticed this a few years ago

When at the time I did not think much of it. Until I realized just now, How much of a boon to the banks that run the card system for the state.

the state must pay out 10% in addition to the basic cost of the banks servicing and supplying the cards.

[lonestarnot]

17. Of course land of McSame and Bile and Stewer have those fees.

Without option of opting out of course.

[femrap]

18. I read that B of A is

charging people 50 cents to be transferred to a supervisor to complain about a fee. I hate these mulit-national banks. Close your account and find a local bank to deal with.

[ellisD]

53. I don't know why anyone would bank with B of A

I remember A few years back after I moved to San Diego I needed to open a new bank account, and I went into B of A because it was right down the street from me. They told me I'd need atleast $1000 initial deposit to open a checking account, and it was going to be about $23 a month in fees! And it wasn't even an interest bearing account! They acted like it was a privilege to let them hang onto MY money!

[octocat lady]

19. Key phrase: "...if the debit card is used at an out-of-network ATM"

That should never be done anyhow, and how many people who have regular debit cards will do this regularly?! The other day, a woman asked me where the nearest ATM was. I told her, but also asked: "Why don't you just go to the store down the block, buy something you need, and then get the money out?" She decided to do just that. It's what I always do. No way in hell will I pay to take out my money!

[smokey nj]

20. That's not the only fee.

From the article, "Most banks give jobless debit card users one free withdrawal per deposit period, which averages every other week in most states." The unemployed who opt for the debit card are being nickeled and dimed to death.

[octocat lady]

21. Yes, and I agree with fighting those other charges, but...

From what I have heard about this whole thing, there is the option of direct deposit and all they have to do is specify that. You need a routing number from a check is all.

If people could live with taking out their money every two weeks, it might be a great way to really keep to a budget. Experts say that it's good to just take out money for the week and not use your debit card willy nilly (like I do) because you tend to spend more when you don't have the physical money there.

[smokey nj]

28. Please don't try to justify this. This is yet another case of government subisidizing banks at

the tax-payers expense. States contract with a bank to administer this unemployment debit card program and then allow the bank to charge users of the program extraordinary fees (forty cents for a balance inquiry?) to use the program. And users aren't notified of the fees until AFTER they've made the choice. What we're talking about here is government sponsored highway robbery and you seem to be blaming the victims.

[lynnertic]

63. Wow, you're quite unpleasant. You made your point before.

No need to jump all over this person. Their thoughts are valid too, and they're nicer so I'm inclined to give them more weight.

[smokey nj]

67. Actually, I was very polite. I have no idea why you're looking to pick a fight with me.

[hobbit709]

54. No direct deposit option here in TX

Here in TX my wife went through this last year, The debit card was from Chase. She had no direct deposit option, so she had to go to the Chase bank about a mile from here. In the course of 6 months, 2 out of every three times she tried to take money out of the ATM, the ATM was either out of cash or out of order. When she went inside to complain and get cash at the window, they acted like they were doing her a big favor by giving her her OWN money. Of course they constantly sent her crap in the mail to open an account with them. The other fun part is that you can only withdraw a maximum of $400 a day. So she had to go there two days in a row to take her money out and deposit it in her account at the credit union.

[liberalhistorian]

25. Some of us don't have a choice in using

out-of-netword ATM's. The bank my state contracts with for the UI debit cards doesn't have any branches within 100 miles of me. So I pay a fee to transfer the balance each week to my own bank account and I have to drive thirty miles to my bank branch just to do that, since I can't do it online.

[octocat lady]

26. How about direct deposit? I heard that you can ask for that instead.

They may not offer the info, however, so you would have to bring it up...

[liberalhistorian]

31. Nope, not an option in my state. My state is about twenty

years behind the times in a lot of areas, including this one. Our Great Governor just turned down millions of dollars in federal stimulus money for unemployment insurance (even though the fund is starting to run low) because he didn't want to have to change a couple of eligibility criteria laws, laws that are considered way out of date and that hurt a lot of people who could qualify for unemployment but don't under the restrictive laws. The unemployment/layoff rate in our state, while being quite low for a long time, has suddenly spiked these past two months and is getting worse by the day. We have run out of money in the state budget. But all our governor and legislature care about is trying to ban abortion in the state and finding more ways to screw the little guy.

[progdonkey]

41. can you get cash back at your local supermarket?

Luckily I don't have this problem any more, since I have an account with Schwab, which reimburses all fees (out of necessity, since they have no "in network" ATMs in the first place, AFAIK), but whenever I've been in an area where my then-current bank didn't have any ATMs, I'd go to the supermarket, buy maybe a 99c packet of gum (or get something I was already planning on getting), and do the cash back option at the register. Basically the market pays the ATM fee for you, since you're buying something from them.

So, you could go to the market, buy some milk, and at the register ask for $100 cash back or whatever you need, and there won't be any out-of-network ATM fees.

That's of course with regular debit cards; I don't know enough about these unemployment ones to know if they'd still charge you there.

Btw, you should look at Schwab.com for their online banking. The only place where it really "fails" is having a convenient store front for depositing physical checks, but you can always mail them in. You can transfer to and from your other accounts through their website. I keep an account I already had at a local bank for the "front-end" thing, when necessary, but everything else I use Schwab--I can deposit checks at my local bank and then transfer them to the interest checking at Schwab online. And, since they cover ATM fees that other banks charge you (and don't charge you any), every ATM becomes an in-network ATM.

[Clintonista2]

22. Don't forget the 40$ overdraft charges

I wasn't able to make my Dell payment on time this month so I called them beforehand and rescheduled to a later date when I know I will have the money. Well, they tried to take the money out of my account anyways and I was stuck with a 40$ overdraft fee from my bank. You have to wonder how a simple transaction that is done by a computer cost them 40$ to perform...

[varelse]

23. The big banks are getting us coming and going

First they hold us up for trillions of bailout dollars, and now they're trying to draw the last remaining drops 50 cents at a time, from those least equipped to fight back.

Nice work if you can get it.

[liberalhistorian]

24. In my state, we aren't "encouraged", we HAVE

to have these damned cards; it's not even an option. And the bank it's through isn't my own bank, so every week I have to pay to have the damn balance on the debit card transferred to my own bank's account, which is what I use to pay my bills. Pisses me off to no end.

[kiva]

29. Hadn't thought of that.

That must be immensely frustrating.

[nightrain]

32. those fees suck.

It's just another way to funnel money to the card companies, and out of the pockets of those who need it most. Crappy.

[zalinda]

33. Be warned...........H&R Block

Apparently H&R Block is doing the same type of thing. A friend of my son's got his refund on a debit card, and was shocked to find out about all the fees attached to it.

zalinda

[unapatriciated]

40. walmart has jumped in too...

they can't go into the banking business, but it is perfectly legal to steal more of your money via the debit card.

http://consumerist.com/346066/walmarts-debit-card-has-lots-of-hidden-fees

El banco del Walmart is issuing pre-paid debit cards, and like everything else at Walmart, they suck. Here's some of the hidden fees:
Card issue fee: $8.94
Reload the card with more money: $4.64
ATM transaction fee: $1.95
ATM balance inquiry: $0.75
Monthly maintenance fee: $4.94
Statement fee: $2.00

Great idea, tap into the "unbanked," and then rip them off. Here's an even better idea for potential Walmart Debit Card users: cash! No fees!

[MrSlayer]

34. The first exchange is free. Just move all the money into your bank account.

First thing. If you don't have a bank account go to the bank and open one with the unemployment money. You don't have to be ripped off by these cocksuckers.

[Swagman]

35. have no doubt-this is a RACKET ! Banks make $$billions from

these unjustifiable charges and weak governments let them collude and get away with it.

A governmnt could negotiate free fees for the unemployed with a bank it does business with.

[Butch350]

36. The system finds a way to milk your wallet every time!

[stlsaxman]

37. GOD DAMN!!!

:mad::mad::mad::mad::mad::mad::mad::mad::mad::mad::mad::mad::mad::mad:

[merh]

39. The federal government has enriched the credit card companies

for years now. They don't want you to pay your SBA loan via check, they want you to use a credit card so the credit card companies can make the fees off of your transactions.

Under GWB the federal agencies all went to accepting payments via credit cards -- that is one aspect of the financial collapse that has not been analyzed, how the processing companies have made a profit yet they are seeking bailouts and federal assistance.

[Hamlette]

42. These stories are bull shit

UI is heavily federally regulated and we have to provide a way for ppl to access it free and we can't make them wait 10 days.

Yes, the card can charge fees but in our state, a claimant can access 3 times a week for free. Some states its only one time a week. So they can go to the bank, or an ATM for free OR they can get direct deposit. It's the law. I know of no states that don't offer direct deposit to a bank. So, this story is about someone who does not have a bank account and didn't read the part about the fees. I also don't believe the part about 10 days for a check. Back in the day our office issued checks it took a maximum of 3 days. There is law that says the benefits have to be paid/rec'd during the period of unemployment (Java) and these scare stores are internet rumors with no research. I'm legal counsel for my state's unemployment office. I've negotiated the contracts with the vendors who pay the fees. We have to give an option (pay for the first three withdrawls) so there are no fees.

Our law says (I think its from federal law but not sure) there can be no fees for accessing or appealing unemployment benefits.

This is complete BS

[NaNa7]

43. Unemployment fees

I work for the emp. office in VA. They do the same thing ( Wachovia Bank). Clients have to sign up with their own bank or the debit card. Some either don't have their info with them , or don't want to give it out on the electronically filed form.
Some don't know how to use the computer , so I have to do it for them. They are stuck between a rock and a hard place.
They are given over seven sheets of paper work explaining what to expect once they file. I'm positive most of them don't read the fine print. Some don't read well or their english isn't good.

We are over-whelmed and under staffed. Its a sad situation. In fact, its heart breaking. Some times we don't go to lunch in order to help them. They wait for hours. I hear some really sad stories. Companies are firing people more now, which means, they most likely want get unemployment. ;(

[Hamlette]

46. I'm shocked that you are under staffed. That is a state problem

we've asked the feds for more admin money and doubled our staff since October.

We have to give them 10 days to choose, we send them home with the info, if they don't get it back when the first payment is due we send it on a card.

I know some of them are not very educated but we don't get a whole lot of problems. But then we've been doing it from about 8 years.

It is a horribly sad situation, but it is not that difficult for the vast majority of people to figure out a debit card or a direct deposit. Our problem has been getting phone lines in fast enough.

In California, they had a right wing head of UI (I suspect) who didn't ask for more staff and the waits there are horrible. But having been through 2 prior recessions while working the UI office, we get how to ask for more money and we know we'll get it.

How long as Va been doing debit cards? Direct deposit? Don't most workers have direct deposit by now for paychecks? I don't get what is so difficult.

I do know, federal law provides we MUST make it accessible with no fee and these stories are BS.

Yes, we are overworked, lots of us putting in uncompensated overtime because we give a shit, but that should be what we are talking about, not some BS story about debit cards which keeps going around and around the internets (and DU)

[NaNa7]

50. It is shocking

The state of VA has closed some employment offices and laid off workers. I only work part-time. Some have worked for the agency over thirty years.

Clients have to file electronically. Larger companies handle this for them. Afterword's they still have to sign up for job service. They have to prove they have looked for at-least two jobs per week or loose their benefits.
They can do this by phone or by computer. The lines stay busy, so they come in. We see over a hundred people some days. We only have 3 full times workers. The others were sent to various branches in the counties.
Alot of the laid off worked in production or construction for years. They never felt the need to learn how to use a pc. Most jobs require that you fill out their application over the internet. Very few accept paper applications.

If a company denies a worker benefits they can appeal. A hearing officer decides who to believe. This can take weeks. Mean while their bills are mounting.
They still have to look for a job while waiting. It can be a long drawn out process for some. They also have to have worked for a certain amount of months before receiving benefits. That is why some companies rather fire them lay them off.x(

[Hamlette]

57. the appeal must be heard and issued within 30 days

and if the claimant was originally issued benefits the benefits continue throughout the employer's appeal (Java). It is only long and drawn out if the first few people in the process deny benefits. If VA is wrongly denying benefits they will be sanction by the ongoing BAM audits we must turn in to the feds plus other states in our region come and audit us as well as the feds.

I really don't see how there is abuse UNLESS

your UI director and/or governor is a fire breathing conservative asshole like the governor of SC who won't take the money to provide services. If that is the case, you will get fined if you don't meet certain minimums. The fine will have to be paid by the state with funds allocated by the state legislature. That is the last thing we want to do, ask our legislature to appropriate tens of millions of dollars to pay a fine to the feds because we didn't do our job right.

We literally doubled our staff since October. Claims are up just over 100% but we watch the numbers daily and if it looks like they are going up more, we hire more people.

[grace0418]

62. Uh, no it's NOT BS. I was given the debit card, no choice whatsoever. I only learned

later, after I read through the mountain of paperwork, that I could opt for direct deposit. But I have to change it via computer and Illinois DES' website doesn't work on a Mac. I'm not real keen on entering personal information like my soc security number and bank account number on a pc at a library. And then I'd have to worry that such a change might screw things up and delay my payments for god knows how long (which is what just happened to a former coworker of mine who tried the same thing). I only access the card once every 2 weeks to withdraw all the funds, and I get charged by the bank that holds the debit card and by my bank.

And to go to my local unemployment office to do anything but the initial filing is a guaranteed wait of at least 4 hours. When I went there to file, I got there at 4:30 on a Wednesday. I got in right away, but the people who were there just ask questions or straighten something out had been waiting since ten o'clock that morning.

[Hamlette]

66. you should report them to Dept of Labor. They are required to allow you to mail it in.

I'll forward your post to a friend of mine who is in their legal Department in Springfield. Illinois has had a reputation, for many years, as being one of the top 3 offices in the nation.

I know this doesn't help, but I've been through 3 recessions and none of us have seen anything like this. It happened so quickly. Our biggest problem was getting the phone company to get us more phone lines quickly but we have literally doubled our staff since October. We are not complaining, we are glad we still have jobs, but what you're going through is ridiculous. Call your congress person. File a complaint. That goes to the feds and always gets attention.

[KitchenWitch]

44. That is beyond fucked up

:banghead:

[Muttocracy]

47. ah, yes, our dear friends the big banks...looking out for consumers as usual.

:eyes:

[Wednesdays]

49. We're back to the days of Les Miserables

Charge 'em for the lice, extra for the mice
Two percent for looking in the mirror twice
Here a little slice, there a little cut
Three percent for sleeping with the window shut
When it comes to fixing prices
There are a lot of tricks he knows
How it all increases, all them bits and pieces
Jesus! It's amazing how it grows!

http://www.youtube.com/watch?v=SFPsEwV38Q0

[pam4water]

51. Wow is all I can say.

[ellisD]

52. Some employers are doing the same thing with paychecks!

My girlfriend works at a Michael's craft store, and they recently switched over their payroll to these "My Money Network" Cards - same basic concept, your paycheck gets loaded onto a debit card, and you have to pay the same ATM, debit transaction, and other hidden fees - the ridiculous thing is there is no paper check option! The only other option is to have direct deposit, so if you don't or cant get a bank account with DD, they you get stuck being nickel and dimed to death to have access to paycheck.

They pushed this system onto the employee's saying it was to "go green" and be paperless, but yet she still gets the same paystub, now the tear off part at the bottom that would have been her paycheck says VOID - NOT A CHECK! How messed up is that?! I really can't see how this is legal to force this on their employees!

[INdemo]

56. Perhaps Steve isn't sure that a one time withdrawal is free..

This is posted on PA's unemoployment web site FAQ

Are there any fees to use the debit card; if so, how can I avoid any fees?

There are several ways to use the debit card without incurring any fees. Cash withdrawals using the debit card are always free from teller windows inside any bank displaying the MasterCard® symbol. Each UC payment gives you at least one free withdrawal at a Wachovia or PNC Bank ATM. The debit card can be used to purchase merchandise, at no fee, at any location accepting the MasterCard® debit card, including purchases made online and by phone. The card can also be used to get cash back when making a purchase, where available. Free balance, transaction history, and account information is available by logging into www.EPPICard.com. Free deposit notification by phone or e-mail is also available

[ThatsMyBarack]

58. ....

:kick:

[SmileyRose]

59. they need a direct deposit option

and why aren't they giving people a list of the rules to keep it free? You know, like taking your money out of the card in one hunk and putting it in your own bank account?

[grace0418]

60. I wasn't given the choice, I just got a debit card. And I can't make any changes on my

account on a Mac (the only computer I have). So every two weeks when the money gets deposited, I take out the whole chunk (well, as close as I can get in $20 increments) and redeposit it in my checking account. Between the bank that holds the debit card and my bank, I get charged $4.00. It is absolutely ridiculous to me that I should get charged fees to access unemployment funds, but it's still better than waiting for a check to arrive in the mail. Some days my mail carrier just never shows up at all. I suspected it before but now I know for sure because I'm at home and can hear the mail being delivered very clearly.

[kiva]

65. Kick for the Sunday people.