I have had a checking account with Chase Bank since 1973. In March I was ill and made the terrible mistake of accepting a number of payday loans. My earnings had increased this year and I believed, incorrectly, that I could easily repay the loans quickly. Now, several months later, I am still in the midst of the payday loan nightmare, and my account with Chase has been filled with overdraft fees as Chase either honors or rejects the ACH withdrawal attempts that are made to my account weekly. I'd say that about half the time the bank returns the attempted transactions. Over the past week I've contacted an attorney who is going to assist me with cleaning up this debt over time. I was told to immediately close my account, but I could not due to pending deposits from my work. I feared that on Friday, 8/17, various loan companies would attempt another withdrawal, and I removed the bit of money I had in the bank, leaving 8 dollars, and pleaded with the bank manager to help in any way she could to ensure that Chase would indeed, again, return the transaction (as they had done the week before when I actually had a decent amount of money in my account, hundreds more than a measly 8 dollars).I woke up Saturday morning to see a hundred dollar deposit from my work (I have arranged for my work to send money to a different account now, which might be another problem since it is also with Chase. However a few direct deposits could not be halted). I also saw $1200 in pending charges from these companies (though they had been contacted by me to let them know of my plan for a legal payment arrangement).On Friday, the bank manager FAX'd those mysterious Chase analysts in charge of determining when to honor or reject a transaction, supposedly telling them that these charges were part of a legal matter and that some of them were viewed as fraudulent. I have to say I sort of took it for granted that the bank would return the charges, since I had a little over a hundred dollars in my account and was overdrawn a few days before. Well...it did not happen. I woke up Monday to see that all charges were honored, and I am now over $1300 overdrawn. I now cannot close my account for an indefinite period of time and next Friday more attempts will be made by other companies. The bank manager will not return my calls and the call center tells me that the bank can, at its discretion, pay or not pay when an ACH withdrawal attempt is made. Of course, I already understood that, but no one can explain why the bank would put me over a thousand dollars in debt when I have had such trouble keeping up. By the way, I do not have and have never had overdraft protection, nor much money in the bank.The arrangement I have with the lawyer has been affected. We had worked out a system of payment based on the total amount I owed to the loan companies. One of these companies put through the entirety of the owed amount on Friday, and Chase has paid them off. That affects the data put together with my attorney, and we have a contract stating that I will make small monthly payments toward fulfillment of a certain amount owed. It is all different now.On Monday another withdrawal attempt was honored. This is from the company that was paid in full on Friday, and I do not understand what it covers. I have tried to dispute these charges, but Chase tells me they are correct. How does Chase know this? I do not have overdraft protection, I have no money coming in now, and I formally requested that the bank return ALL transaction attempts. Chase is disregarding my wishes, and I do not get it. Does Chase benefit in some way from this activity? On Friday, other withdrawal attempts will be made, and Chase may honor all of them, negating my arrangement with the attorney and forcing me to continue to make these high, fee-ridden payments. I intend to pay this debt. I am only trying to set up monthly payments through an attorney. These loan companies, of course, will not want to work with this arrangement, and Chase is supporting their actions. I want the bank to return the attempts as any bank would do, since there is no money. You have seen a few questions posted above. My main two questions, the reason I am here, are these:1. Is there any action I can take, pronto, to stop Chase from honoring these charges? I am overdrawn, no money is coming in, but I have foolishly set up another account for future deposits (starting next week). The banker did not alert me to the fact that Chase can go in and out of various accounts, taking money wherever they wish. I cannot close my original account due to the overdrawn status.2. Can I sue Chase in small claims for manipulating my account and disregarding the information I have given regarding the fact that these transactions are part of a legal matter (or will be, formally, as soon as I can pay the attorney next week, something else that would not have been a problem if Chase had simply returned the charges last week).
State/Country relating to question: Texas
I have attempted to freeze my account, to no avail. I have attempted to dispute some of the charges and was told they are correct. The local bank manager FAX'd the bank analysts to tell them the legal nature of this issue, with a simple request to return all charges to the companies presenting them, due to overdraft status in my account. I attempted to close my account, with no luck, due to a pending deposit.
Thank you for the post, I am happy to assist you by answering your questions. Regarding your two main questions, have you claimed that the charges are fraudulent, or is this not possible because the charges are legitimate but you are not in a position to pay them at this time?
All but one of the charges are legitimate, but my account could not sustain them and still cannot. A questionable charge went through today that is from a company that was paid in full on Friday.
I have never earned a lot of money, and over the past several months, there has been a history of overdrafts -- sometimes Chase pays them and other times, they return everything, based on a mysterious formula.
They returned around $600 in attempted withdrawals about 10 days ago - returned all of it, though I had a fairly substantial amount of money in my account, much more than a few days ago, when they honored $1200.
May I add...I have written to these companies to tell them I am in the midst of setting up a legal payment arrangement. I told them to stop the ACH withdrawal attempts from my bank until the arrangement goes through. The attorney told me that these companies will still attempt to take money from account -- thus the importance of closing the account asap.
Thank you Candis, the reason your bank is authorizing the withdrawals is because they are legitimate charges, therefore the bank could be sued by eh party seeking to withdraw the money for refusing the transaction. The bank then has the option of overdrawing your account or returning the charge NSF, which appears to be the more appropriate recourse when your account balance history is somewhat low. In 2010 did you by chance consent to overdraft fees in the event your account is insufficient to cover a pending withdrawal? I ask because federal legislation was passed in 2010 requiring account holders to consent to this practice and incur NSF fees, or opt out and the charges returned to the merchant as declined.
I do not recall consenting to this course of action, though I may have. It would have appealed to me then. I absolutely do not remember being asked to consent to something like this, though I did sign a form to allow charges to my debit card under the bank's discretion -- this was last year, I believe. I can say that Chase began to honor bad checks for me in 2006, then allow me to just keep the account overdrawn until I could make up the funds. They don't always do this for me -- there are times when they return charges. I don't do this constantly, mind you...perhaps 1-2 overdrafts a year, except for a period of months in 2006 and the current problem, which has been going on since April.
Also, wouldn't the bank remind me of this form now that I am complaining about their current practice of honoring these withdrawal attempts?
They are also manipulating my funds. I set up a new account on Thursday and told the banker that it was to protect future deposits. I then contacted my workplace to send direct deposits to the new account (there will be a 10 business day delay for this process to take effect, therefore no money will be entering any account till late next week).
Some deposits were already in the system and due to reach my original account on Friday, Saturday and today. The bank has "kindly" arranged for those deposits to go into my new account, though they did not tell me they can do this. So...the bank is sending these ACH withdrawal attempts into the original account, so far and honoring all of them, despite lack of funds from me, and they have allowed me to have some money in the new account (a few hundred dollars).
I am concerned that the bank will take money from this new account to cover all charges in the original one, once I actually have money available from my work. And these payday loan companies will attempt to take more on Friday -- I cannot believe the bank will honor them, with my $1300+ overdraft, but perhaps they will.
This negatively affects my arrangement with the debt lawyer.
Thank you Candis, if you consented, the bank has no obligation to remind you of this or aide you in your arrangement with the debt attorney by amending the terms of the consent agreement for overdrafts. The unfortunate reality is that you may have unwittingly consented to the very actions the bank is now taking when you agreed to the overdraft fees system. you mentioned that the bank manipulating your funds, can you elaborate on this point? I ask because if true, you have grounds to sue the bank, but if by manipulation you mean allowing the charges to go through and charge you overdraft fees, that is not exactly manipulation.
It looks like I responded to your reply while you were writing it. They are managing my two accounts in their own way, without notice to me. The banker did not tell me that Chase could place my three original work deposits into my new account. If they had done so, I would not have to wait 10 days to be paid, as I would not have given my workplace the new account info. I am concerned that Chase will then take money out of my new account to pay the original one off. In other words, I have no idea where my money is going currently.
Is there any way I can research if I signed the overdraft agreement? I do not recall signing it, and this seems like something I would remember, since it would have appealed to me.
Thank you Candis, the banks were actually calling and recording the conversations with customers, then sending out confirmation letters. You can request a copy of the letter sent to you confirming your opting into the NSF option. Regarding the management of your accounts, does your account services agreement enable them to manage the accounts in the way they have? If so, then technically you would be considered on notice per the terms of the service agreement, you therefore should request a copy of your service agreement as well, in fact it may be available online via their website when you log into your account(s).
Successful consumer advocate.
I just wrote a note to thank you, but I have the feeling it went to Customer Service rather than to you. So again, thank you for working with me on this issue. It has kept me awake nights. I'll research further regarding consent, etc.
Thank you Candis, I truly wish you the best in this situation.
1. I have read the Service Agreement, and there is nothing saying that the bank can "manipulate (my word)" multiple accounts, depositing/withdrawing funds at the bank's discretion.
2. I spoke with a CS at the call center who told me that the bank never contacted customers to set up the overdraft option that you mentioned to me. The rep simply stated that Chase can choose to pay or reject checks/withdrawal attempts, again, at its discretion.
There is nothing in writing about either of these issues. Nothing implying the bank's rights, etc.
Today, Chase put through another charge that I believe is fraudulent. It is from a company who was paid in full last week, and it is a repeat of another identical charge from Tuesday. I am waiting to hear from the bank manager about this, if she returns my call. I have had $105 enter my account from work this week, yet Chast continues to honor these charges.
Do you think that I might have grounds to sue in small claims? I have read that banks will often settle cases rather than go to court.
Do you advise people on this subject of small claims, and if so, what is your fee?
Just your opinion...do you think that Chase may fund these loan companies? Its recent actions are causing me to lose thousands of dollars that would be saved in my agreement with the debt lawyer. He will negotiate a much lower final fee, with small monthly payments.
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