Wamu Banker’s Pen

So. I promised myself this would simply be a forum to educate people on what I think are obvious, but overlooked, paradigms of personal finance. And possibly other topics (though my econ background doesn’t help with cooking — and i expected economics at university would be like home economics in high school!). I promised myself it wouldn’t be the typical blog-slash-opportunity-to-bitch.

Well, I found something to bitch about. So that promise has gone out the window by post #2.

Today WaMu charged me $20 for “excess activity” in my savings account (two $10 charges). Upon calling, I was told that it’s an FDIC-mandated charge placed on savings accounts, essentially as a way of differentiating them from checking accounts, called Regulation D. And that it comes into effect after six transactions per billing cycle. And that there was nothing they could do about the charges. And a number of posts on the internets seem to confirm this.

However, a number of posters on the internets haven’t looked at the FDIC regulations.

Regulation D is actually FDIC Regulation § 204.2(d)(2). It’s basically just the definition of a savings account. And one of the definitions they stipulate is that in a savings account,

under the terms of the deposit contract, or by practice of the depository institution, the depositor is permitted or authorized to make no more than six transfers and withdrawals […]

per month. So far, so good. The regulation’s got a footnote suggesting that

in order to ensure that no more than the permitted number of withdrawals or transfers are made, […] a depository institution must either […] prevent withdrawals […] or […] contact customers who exceed the established limits on more than an occasional basis.

The emphasis is mine.

So, if your bank, like WaMu, tells you that they must charge the fee because of FDIC regulations, it’s utter BS. They only thing they really are required to do is to send you a letter if you exceed six transactions more often than occasionally, or stop you from making those transactions.

Additionally, it seems most banks won’t refund the fee. This makes absolutely no sense. If they’re willing to refund an fee for something that’s completely my fault and a reasonable person would be aware of (bounced check fees, as Washington Mutual does once per year), I don’t understand why they won’t refund a fee that most people have never heard of.

Keep in mind, though, that your terms and conditions probably stipulate that they’ll charge you. I’m so sure of this assumption that I haven’t even bothered checking WaMu’s. And, ultimately, that’s what matters. So, dejected, I just wrote an email:

I just wanted to say that this fee is excessive, unnecessary, and the fact that I’ve been charged has really soured me to an otherwise very good WaMU experience. You’ve gone from ‘recommend’ to ‘at least they’re better than wells fargo’.Unlike an NSF after writing bad checks, this fee isn’t well-known or even all that logical. And customers can get one NSF fee reversed. This should be reversed until the customer is made aware of it at least once.

And the excuse ‘federally mandated’ is insufficient. The FDIC mandates that you take action to minimize excess transactions. They specifically recommend preventing excess transactions, or that you contact the customer.

If this weren’t very likely contained in an agreement that you know nobody reads, I’d be much more unhappy.

James

So, learn from me and don’t use your savings account as your primary account. And if enough people are aware that the fees aren’t actually mandatory, maybe banks will change this some day. Maybe.