Why Did Banks Get So Mean?

Old Man Potter of the Bedford Falls Savings and Loan would feel right at home in some of today's big banks.

Yesterday I read a Boston Globe column by reporter Farah Stockman about the harassing phone calls she received from her bank last year.  PNC Bank called Stockman repeatedly while she was reporting from war-torn Pakistan because they claimed she owed them 64 cents.   The international cell phone calls were costing her $3.00 a minute but PNC kept dunning Stockman every day.

The story is a real testimonial to how bad the mega-banks have become.  One consumer advocate told Stockman that banks are now shaking down their depositors for fees and loose change (like her 64 cents) because they can’t make money the way they once did: by giving depositors a ridiculously low interest rate then lending out their deposited money to small businesses and other borrowers at a higher rate.

Stockman’s story provides the perfect segue to ranting about my own least-favorite bank:  The Bank of America.  Make that the bank of rich, corporate America.

Visiting the bank used to be a more friendly experience.  They gave out toasters or umbrellas if you gave them $25 to open an account.  Now they charge you $25 a month if you don’t have at least $5,000 in your account.  This is not a lie – it  happened to me a few months ago.

We have had some type of relationship with B of A, or with the smaller fish they gobbled, for about two decades.  Bay Bank was gobbled by Bank of Boston, which was gobbled by Fleece Fleet Bank, which was gobbled by B of A.  As recently as a few years ago I had nice memories of the folks at our local branch.  They knew my name and doled out hundreds of lollypops to our kids.

We pulled most of our money out of B of A about five years ago, after we missed one payment on our credit card and they jacked up our interest rate to 30 percent.  They offered us 10 percent as a peace offering.  We moved the bulk of our cash to a more consumer-friendly locally-based bank but kept some money in B of A, largely because three of our children had student B of A accounts and it was easier to get money to them that way.

Soon after we reduced our B of A holdings we began getting $25 taken out of our checking account each month for a “maintenance” fee.  When we called them, they pointed out that we our account was a money market one that paid a higher interest rate (I believe it was 1.4 percent!), but you had to keep at least $20,000 in there.  So we were able to find another account that offered a less princely interest rate in exchange for being free.

But lo and behold! A few months ago the $25 charges started coming out again.  When I called to complain, the B of A telephone person told me, “I see you have an Advantage checking account.” She then pointed out all the benefits that I was getting for my advantage account, including free checks.

“But I never asked for an ‘advantage’ checking!”  I said.

The clerk told me she’d remove one of the $25 charges but I had to go to my local branch to change the type of account.

In the meantime I did a mini-rant about this “advantage” checking BS on my Facebook page and got a lot of commiserating comments.  Wrote our son Jesse:  “An advantage account means that you give them your money and they take advantage of you.  See the advantage?”  Others urged us to go to a credit union or a smaller bank.

When I visited our local B of A to try to change to a free checking account, I recognized the nice people who used to give my kids lollypops, but they were not the ones that the bank put in charge of playing hardball with customers.  That job belonged to some unfamiliar new bank zombie – someone who was obviously unhampered by any previous warm and fuzzy relationships with the clients.

She spoke to me as if she were reading from a script.

She said that if I wanted to have a no-fee account I had to either keep at least $5,000 in my account or get a B of A credit card and use it at least three times a month.  I told them that my husband and I already had a credit card, thank you, and we preferred to have just one and use it as little as possible.   When I turned down the credit card, one of the managers came over to try to talk me into taking it.  “You only have to use it three times a month!,” she pleaded.

“You know,” I said, “how come you can’t just lend my money out to small businesses and make money that way?”

The Stepford bank employee managed a very tight smile and said, as if by rote, “well, you pay money every month for other conveniences.  Banking is a convenience too.”  In other words, lock up $5K, get one of our high-rate bank cards, or stuff it in a mattress – those are my options.

Just last fall, right after the debacle over B of A’s attempt to charge depositors $5 a month to pay stores with their own money if they use a debit card  –which incidentally, saves the bank lots of money over the cost of processing a paper check, which people once used to pay at the cash register — the bank started working on its image.    One B of A television commercial focused on Pink’s Hotdogs, which paid glowing tribute to B of A for lending it seed money to expand its hotdog empire 71 years ago.

I wonder what would happen if Pink’s asked B of A for a loan today.  We decided that the bank officers would laugh the hapless hotdog vendor out of the office, roll his cart off the nearest pier, or set it on fire and find a way to collect the insurance money.

Years ago banks gave you a toaster to invest your money there; now they burn you with fees.  They once gave you an umbrella but now they hang you out to dry.  Farah, I think it’s time for a credit union.