Answer to my question about

the illegality of overdraft fees.

but those were already dealt with in the court decisions Wells Fargo and MultiDistrict Lit in Fla.

because banks are enforcing illegal fee, fine and penalty clauses, and the courts have let them so far (big mistake) they got bolder and bolder and all of them do it. there is no real "shopping around". every consumer is stuck with huge, unrealistic fees, fines and penalties.

1) they were told to do so by the OCC (let the customer know and reject a transaction that will incur a fee)

2) they have the ability to do it

3) none of them have offered this feature, even tho they were told to do it 5 years ago!

it is illegal because under basic contract law, you only get actual damages. liquidated damages must be realistic and related to actual, anticipated damages. the banks are supposed to follow the 4 OCC guidelines on setting these fees.

all good reasons.

again, i can do this, neither can you, so why do banks get to do it. i could put it in my contract and on my website and still no court would allow it.

Two recent court decisions

The first one is the Multi District Litigation in Florida wherein class action plaintiffs sued banks--9 major banks were involved–Chase, Wells Fargo, Citibank, etc.–you name it! The court held that the following claims will stand for discovery: 1) breach of contract for lack of good faith and fair dealing 2) unconscionability ($35 is unconscionable) 3)unjust enrichment; 4) consumer fraud and 5) deceptive trade practices.

whether you know it or not, the banks constantly manipulate balances in their favor. they use sophisticated software to maximize their fees.

this is NOT the law. the law is, if you breach a contract, you only get actual damages and not made up or phanthom damages. fees, fines and penalties are not permitted.

Yesterday someone asked about this and I gave her the law for her case.

One of the things you should know is that the OCC has dictated that before the banks set out fees, fines and penalties, the bank must follow 4 rules in setting these or changing these. The rules are:

(b) Considerations. The establishment of non-interest charges and fees, and the amounts thereof, is a business decision to be made by each bank, in its discretion, according to sound banking judgment and safe and sound banking principles. A bank reasonably establishes non-interest charges and fees if the
bank considers the following factors, among others:
(1) The cost incurred by the bank, plus a profit margin, in providing the service;
(2) The deterrence of misuse by customers of banking services;
(3) The enhancement of the competitive position of the bank in
accordance with the bank's marketing strategy; and
(4) The maintenance of the safety and soundness of the institution.

what the court found is that while the banks had a lot of memos on maximizing BSE or Balance Sheet Engineering, they had no memos or meetings that they followed these 4 criteria at all. Hence WF fees were found illegal.