From: Michael Walsh <walshmichaelj at gmail.com>
Date: Tue, 21 Jun 2016 19:49:52 -0400
Subject: [WSFA] Re: Bank dirty tricks
To: WSFA members <WSFAlist at keithlynch.net>
Reply-To: WSFA members <WSFAlist at KeithLynch.net>

On Tue, Jun 21, 2016 at 7:38 PM, Keith F. Lynch <kfl at keithlynch.net> wrote:
> Yesterday in the mail I got a letter from my bank saying that a large
> long-term CD of mine had matured, and that they had taken the liberty
> of renewing it for the same long term -- with a new much lower
> interest rate of 0.2 percent.
>
> So today I went to the bank, to cancel it.  The banker explained that
> I only had ten days to cancel this CD which I had neither requested
> nor been informed of until yesterday, and that the ten days had ended
> a week ago.  I said I didn't care that I wouldn't get three weeks of
> 0.2 percent interest -- when I see that much money sitting on the
> sidewalk, it's not worth my while to bend over and pick it up.  The
> banker explained that no, it wasn't just a trivial amount of lost
> interest, it was a $200 penalty.  And he didn't have the power to
> waive it.
>
> I told him to contact whoever does have the power to waive the
> penalty, since if it wasn't waived, I would be removing all my money
> from the bank, and advising my friends and relatives to do the same.
> I also pointed out that theft of $200 is grand larceny, a felony, and
> that I could go to a magistrate and swear out a warrant, and let the
> courts decide which bank officers deserved prison for this serious
> crime.  (Very likely they would prevail in court, but only after
> spending a hell of a lot more than $200 on legal fees.)  I could
> also go to the FDIC and try to get their charter revoked.
>
> (I didn't say I *would* contact the state and federal government, but
> merely that I *could*.)
>
> I can't imagine they won't waive it, unless the bank is either
> hopelessly incompetent or so close to bankrupt that they'd rather
> have $200 now than retain a profitable long-term customer.
>
> I'm posting this to warn people to watch out that your bank doesn't
> pull a similar dirty trick.  See if you can get your bank to put a
> promise in writing not to put your money in a worthless investment
> without your permission and charge you to get it back.  I'll name the
> bank only if they fail to waive the fee.
>
> Too bad that bank wasn't around in 1626.  If Peter Minuit had spent
> $24, not on Manhattan, but on a 0.2% CD, thanks to the miracle of
> compound interest his estate would be worth $52 today!  No wonder the
> bank just assumed that of course that's where I would want to put my
> retirement money.

You may recall this banking incident:
http://www.npr.org/sections/thetwo-way/2011/06/06/137002727/sweet-justice-a-florida-couple-forecloses-on-bank-of-america

mjw