Consumer complaint received 2018-09-24
Product: Checking or savings account — Checking account
Issue: Problem caused by your funds being low — Overdrafts and overdraft fees
Company: FIRST NATIONAL BANK OF PENNSYLVANIA (PA)

On XX/XX/2018 First National Bank of Pennsylvania, using a common set of circumstances as a pretext, pilfered {$180.00} from my checking account. Thats the entire monthly transport budget for my daughters school, or eight meals for my family. 

The bank, along with all of its industry competitors, does this to thousands of its customers in our state every year. A large proportion of its operating profits are now derived from such fees, despite numerous attempts by state and federal legislators to bring predatory and unethical retail banking practices under control. 

It is certainly a familiar story to the CFPB. An unexpected charge was presented to the bank via ACH. That there were sufficient funds to cover the overdraft in another account in my name at the same bank, meaning there was no risk to FNB, did nothing to protect me. 

The bank intentionally did not notify me of any problem, as it was not in its immediate pecuniary interest to do so, No call, no text, nor any attempt at communication. I therefore continued to use the account normally during the course of the day. Charges at local retailers were honored when there were insufficient funds in the account. FNB re-ordered the transaction sequence to maximize the imposition of fees. The distorted chronology can only be viewed internally, as the bank deliberately omits transaction times from the online statement available to consumers. 

Of course the retail charges should have been declined, thereby alerting me to the issue so I could immediately deposit funds. Thankfully, that they were not declined gives your office a clear opportunity to use its authority not only to achieve a measure of justice for me, but to defend banking consumers, as it is mandated to do. 

When I opened the account, I made absolutely plain that I do not want any overdraft protection service. The bank manager confirmed I would be opted out. But she lacked the internal authority to make the decision. FNB policy requires overdraft service for my account, in direct defiance of federal law, on the pretext that I have my Bed & Breakfast name on the account as well as my own.

Thats clearly illegal. FNB lacks the right to arrogate to itself an exception to the law, which was drafted with the explicit intention to protect individuals from exactly this sort of larcenous conduct, irrespective of whether they are self-employed. The practice could not possibly bear legal scrutiny. 

It is not only consumers especially those on low or fixed incomes who are victimized. The bank instructs its employees to respond to affronted customers with a litany of wholly implausible statements that either blame the customer or even assert that the policy is conducted in a manner to benefit him. Bank employees are well aware that it is hogwash, but are compelled to compromise their own integrity on a daily basis. Managerial-level bank employees, who ostensibly have the authority to waive the fees, are forcefully incentivized not to do so. 

FNB is absolutely correct when it asserts that its conduct is consistent with prevailing practices in the industry. Switching banks would be meaningless as, in the absence of any meaningful deterrence, they have all developed a reliance on the same unethical fees to compete. From the standpoint of the consumer, its a cartel. There are no real choices, and one bank is the same as another.

And that is exactly why your office must act not only to correct FNB, but to message the entire banking sector that such conduct will not be tolerated. Only then can it put an end to an injustice that causes real misery for thousands of vulnerable consumers. 

I urge you to investigate this incident and take firm, meaningful and public action. The incident should cost FNB at least {$180.00}, so that the incentives for dubious conduct are mitigated. You should make plain that the bank is under proper regulatory scrutiny going forward. I also expect your office to support me in case the bank chooses to retaliate against me for this complaint.