CHARLOTTE, N.C. -- Bank of America has voluntarily waived overdraft fees. But some consumer groups say Congress still needs to act to ban exorbitant fees.
Consumers complain about them. And they're the subject of a wildly popular viral video.
One of those consumers is David Senter of Lincoln County. When he's not adopting pet bloodhounds, Senter drives a truck over the road. He puts his expenses on his debit card. But Senter's bank, Fifth Third, posts big charges first, out of order. The move means that last month he was hit with two overdraft fees of $37 each instead of just one.
"It's all big business, trying to get more money out of the little guy," said Senter.
Chris Kukla, a consumer advocate at the Center for Responsible Lending in Durham, says the fees are legal and that's the problem.
"So if they want to reorder checks to make sure if you bounce one, you bounce multiple times -- they can do that," said Kukla. "This has been a big money generator for lending institutions."
How big? A recent report by the Center for Responsible Lending estimates $24 billion a year. The report finds that typically overdraft fees far exceed the total of the overdraft.
"What's more likely to trip you up is a cup of coffee or lunch or a bill at the dry cleaners than it is your mortgage payment or your car payment or anything like that," said Kukla.
Bank of America is voluntarily eliminating the fees. And other banks including Fifth Third may soon follow suit. But consumer advocates like Kukla say there still ought to be a law against the fees. And they strongly support a new consumer financial protection agency independent of banking regulators, whom they say have overlooked onerous fees.
A viral video featuring several generations of Saturday Night Live comedians who have portrayed ex-Presidents supports a new consumer protection agency.
Senter says it's about time.
