Bank of America loses credibility

By Julia Lytle
Published: October 2009

Walking into any Bank of America branch, the overly friendly tellers, the greeters dressed in suits, and the baskets of lollipops make any customer feel at ease, despite the reason for their visit. What many people cannot tell from this outside appearance is that their preferred bank is now being investigated for fraudulent behavior concerning various fees that it has been distributing to earn extra revenue.

Bank of America has won over its customers during the past few years with its inviting advertisements describing its various services, like its famous “Keep the Change campaign. Bank of America has also reached out to the younger generations with plans like Campus Edge that allow teenagers and college students to open bank accounts without parental involvement.

Bank of America is based in Charlotte, North Carolina and is currently managed by President and CEO Kenneth D. Lewis and Chairman Walter E. Massey. The huge conglomerate, now present in 150 countries and in contact with 99 percent of America’s Fortune-500 companies, has bank branches that can be seen on almost every street corner in the United States, no matter how remote the location.

What many loyal Bank of America customers did not expect from their trusted bank was for it to take advantage of many of its customers and subtly over-charge people for minor banking mistakes. Bank of America has come under the criticism of many people recently for excessive overdraft fees and charges for other small transactions such as checks bouncing.

As Bank of America has spread throughout the United States it has also spread to the younger generations, reaching out to teenagers and college students with its Campus Edge Checking accounts. These debit cards authorize credit card transactions that will result in negative debit accounts, as well as hefty 35 dollar overdraft fees.

Many of Bank of America’s young customers now find themselves in a bind as they try to pay back the money they have spent, in addition to hundreds of dollars in overdraft fees. Inexperienced bankers as young as 16-years-old are being taken advantage of without any knowledge or experience in dealing with banking debt.

One of the most controversial actions taken by Bank of America has been its installment of overdraft fees. These fees are charged to a customer’s account any time the amount of available funds in their checking or savings account is overdrawn. The first time a person overdraws their account, a 25 dollar charge is taken from their account, and each time following, the charge is 35 dollars. Similar fees apply for bounced checks and returned items.

Bank of America is now facing several lawsuits from customers demanding that “America’s favorite bank has been taking advantage of them. Bank of America and its bank affiliates are now giving up 35 million dollars in order to settle the various accusations that have been thrown at them. They have been accused of manipulating people’s bank accounts in order to be able to charge more excessive fees.

With the establishment of smaller, more independent banks and with this new lawsuit controversy that has put Bank of America in the news recently, many people are choosing to take their banking elsewhere, as the bank that they once trusted has started to subtly take advantage of them.

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