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#328931 - 03/03/05 04:50 PM
Returning Largest Chk-Can we charge OD on others
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Diamond Poster
Joined: Apr 2002
Posts: 1,677
SmallTown, USA
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Following asked this morning: (1) Customer Balance is $100. (2) Incoming checks $200, $30, $25. (3) We return the $200 and charge account $27 return fee. Leaves balance of $73. (4) We pay $30 & $25 check. Leaves a balance of $18. (5)Can bank charge OD fee on the $30 & $25 check? (6) Currenlty, if asked the bank will say we post largest items first.
My initial reaction is no. However, mgmt wants to see where this is actually prohibited.
Any help is appreciated.
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#328932 - 03/03/05 05:56 PM
Re: Returning Largest Chk-Can we charge OD on others
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Diamond Poster
Joined: Jan 2003
Posts: 1,454
metsuretsu
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If the account is not overdrawn, why would anyone charge an overdraft fee. The returned check warrants the return check fee, but two checks that are paid that don't overdraw the account . . . I would hate to be the employee having to deal with the customer if this was done (although to be the attorney, hmmmm)
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#328933 - 03/03/05 06:01 PM
Re: Returning Largest Chk-Can we charge OD on others
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Diamond Poster
Joined: Jun 2002
Posts: 1,044
The banana bin
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Although I can't site any sources, I basically look at it this way (and I can be all sorts of wrong )
The customer at the end of the processing day was overdrawn three items...regardless of what your decision was to pay or return the following day. As long as you've disclosed properly, I don't see any reason why you can't charge them. Again, I could be horribly wrong. haha.
Now, customer service might dictate that you waive the fees, but in my opinion, I don't think you'd be forced to.
Again, could be horribly horribly wrong.
Last edited by ~Amy~; 03/03/05 06:01 PM.
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#328935 - 03/03/05 07:33 PM
Re: Returning Largest Chk-Can we charge OD on others
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Diamond Poster
Joined: Oct 2004
Posts: 1,227
Bear Country
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Maybe I think this just because I work at a small bank, but I feel this is a big reason why banks get a bad reputation. I know that it's technically allowed to charge for all three, but let's be serious. Look at it from their side. This is a big complaint I hear from my friends about banks. Always looking for ways to charge more money instead of being reasonable. Ok, my rant is over with. Sorry!
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#328936 - 03/03/05 08:57 PM
Re: Returning Largest Chk-Can we charge OD on others
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Diamond Poster
Joined: Apr 2002
Posts: 1,677
SmallTown, USA
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Thanks for the responses. I have sent an email to legal counsel at TBA to get their opinion.
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#328937 - 03/03/05 09:11 PM
Re: Returning Largest Chk-Can we charge OD on others
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Diamond Poster
Joined: Jun 2002
Posts: 1,044
The banana bin
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Blue- I agree but I tell this to all of the people who complain about it: The OD/NSF fee is a fee that can be fully avoided by the customer. Bottomline: Don't write checks off of funds you don't have yet. And yes, I agree, there is a customer service standpoint. I have no problem waiving a fee for a customer who rarely if ever is overdrawn and had a mathematical error. But I don't have much sympathy for those that are so blatantly writing bad checks either because they hope the check won't clear until payday...five days away or they simply don't care and write a check to the casino. But the majority of my overdrafts happen to be people in the latter group. I'll help them out to a point but there comes a time when they've got to accept responsibility.
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#328938 - 03/03/05 09:34 PM
Re: Returning Largest Chk-Can we charge OD on others
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Diamond Poster
Joined: Oct 2004
Posts: 1,227
Bear Country
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I'm not arguing that fact with you at all Amy. I'm just talking about customer who is a first time offender. My mom had never been overdrawn in the 15 years at her small bank, accidentally wrote a deposit down wrong and it caught up to her 3 months later, called the bank and brought in the money as soon as she found out, and was still hit with roughly $50 in O/D fees. Or about my friend who was overdrawn by 25 cents and charged $30. Is this right? Yes, the customers were technically wrong, but this is the stuff that gives banks a bad name.
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#328939 - 03/04/05 03:36 AM
Re: Returning Largest Chk-Can we charge OD on others
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10K Club
Joined: Jul 2001
Posts: 83,396
Galveston, TX
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If you have a large to small posting order you could charge them 3 overdraft charges if you pay all the checks. However, if you return the $200 check - you cannot charge them for the two smaller items. You can't have it both ways - if you don't pay the $200 check then you have to pay the two smaller ones. Try not doing it that way and see how long it takes you to wind up in court for wrongful dishonor.
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#328941 - 03/05/05 01:55 AM
Re: Returning Largest Chk-Can we charge OD on others
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Member
Joined: Oct 2003
Posts: 69
Florida
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Quote:
If you have a large to small posting order you could charge them 3 overdraft charges if you pay all the checks. However, if you return the $200 check - you cannot charge them for the two smaller items. You can't have it both ways - if you don't pay the $200 check then you have to pay the two smaller ones. Try not doing it that way and see how long it takes you to wind up in court for wrongful dishonor.
Not that I agree with this at all but my bank does charge an NSF fee for all 3 items even though the $200 check is being returned. It's very hard explaining this to the customer when you don't really agree with it but you just have to come back to the fact that they wrote out the checks even though the funds weren't in the account.
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#328942 - 03/05/05 04:00 PM
Re: Returning Largest Chk-Can we charge OD on others
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10K Club
Joined: Jul 2001
Posts: 83,396
Galveston, TX
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IMHO - Your bank is headed for a class action lawsuit that they are not going to be able to win. I would recommend contacting an knowledgable attorney regarding this practice.
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#328946 - 03/08/05 04:31 PM
Re: Returning Largest Chk-Can we charge OD on othe
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Diamond Poster
Joined: Apr 2002
Posts: 1,677
SmallTown, USA
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Original Poster Here -- I am glad to report that we will not implement this practice. Thanks to all for your responses.
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#328947 - 03/08/05 09:21 PM
Re: Returning Largest Chk-Can we charge OD on othe
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Anonymous
Unregistered
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Edge... did this discussion have an impact on your decision?
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#328948 - 03/09/05 02:55 PM
Re: Returning Largest Chk-Can we charge OD on othe
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Diamond Poster
Joined: Apr 2002
Posts: 1,677
SmallTown, USA
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This idea came from the CFO. (He is currently out of the bank for surgery.) When I brought the info from this discussion to the CEO, he had already decided against it. He did seem pleased that most of the comments supported his decision.
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#1246141 - 09/08/09 02:12 PM
Re: Returning Largest Chk-Can we charge OD on othe
OnTheEdge
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Platinum Poster
Joined: Feb 2003
Posts: 624
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This thread is about 4 years old & was curious what the current thinking is on charging fees on the original scenario presented. (1) Customer balance is $100. (2) Incoming checks of $200, $30, & $25. (3) We return the $200 check and charge account $27 return fee. Leaves balance of $73. (4) We pay $30 and $25 check. Leaves a balance of $18. (5) Can the bank charge an OD fee on the $30 & $25 check? (6) Currently, we post largest to smallest.
Current opinions?
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#1246275 - 09/08/09 04:05 PM
Re: Returning Largest Chk-Can we charge OD on othe
donnac
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10K Club
Joined: Aug 2001
Posts: 21,939
Next to Harvey
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Think "Unfair and Deceptive"...
Given the increasingly hostile attitude toward ODP as indicated by wave after wave of regulation. I think my prior reference is an understatement. The practice is blatantly dishonest...
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#1246538 - 09/08/09 07:23 PM
Re: Returning Largest Chk-Can we charge OD on othe
Elwood P. Dowd
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Platinum Poster
Joined: Feb 2003
Posts: 624
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Thanks for the update & confirmation. We agree & will not be charging.
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#1247562 - 09/09/09 08:56 PM
Re: Returning Largest Chk-Can we charge OD on othe
Elwood P. Dowd
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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The practice is blatantly dishonest... But from what I read here and on BankingQuestions.com, it's something that some bankers persist in doing. They are probably cut from the same cloth as the bankers that started the whole abusive overdraft protection practice that got all bankers tarred with the same regulatory brush.
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#1247683 - 09/10/09 01:05 AM
Re: Returning Largest Chk-Can we charge OD on othe
John Burnett
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10K Club
Joined: Jul 2001
Posts: 83,396
Galveston, TX
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I'm surprised they haven't been sued for wrongful dishonor.
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