After all the uproar that banks have started regarding overdraft fees for ATM and debit card transactions, the Federal Reserve has put a new rule in place that requires banks to get their customers’ consent before they are able to charge fees due to an overdraft. The rule is to go into effect on July 1st.

The rule came after consumer groups kept getting complaints from customers and members of Congress even said that the overdraft fees were unfair.

Many people believe that if their debit card is cleared for the charges, then there isn’t a problem with the amount of money in the bank.

I have always found it odd that overdraft fees always come from the smallest of charges and it is often something like a cup of coffee. I can only remember getting an overdraft fee once and it was for a soda from a convenience store. The only problem I had was the bank, which I had just visited and checked my balance, said I had more than $25 in my account.

It turns out some banks participate in a strange accounting practice that allows for small transactions to go through while deposits get put off.

I am really happy that the Fed got involved and decided to put this rule into effect. I wish it would have been put into place a bit earlier than July 1st of next year, but I suppose better late than never. Now if only some people were able to recover some of the overdraft fees that have been collected over the years for the “funny” accounting rules I was talking about earlier.

A lot of public scruitiny has been placed on Bank of America after giving out nearly $6 billion in bonuses to Merrill Lynch executives. Just a week after a trial resulted in a $33 million settlement, in which the bank agreed to pay but admit to no wrongdoing, in the case against BofA, the SEC has decided to go to trial against the company to see that it is properly punished for its actions.

Bank of America was supposed to turn over information regarding the merger yesterday, but instead a top executive is meeting with House Representative Edolphus Towns about the acquisition of Merrill Lynch.

The SEC is looking to charge the bank with additional charges if, through the course of the trial, new evidence is discovered or evidence supports any allegations. It could also begin charging individual executives in the trial.

Bank of America was one of the largest takers of TARP money when the government started dealing out the $700 billion in taxpayer funds. So, of course, when money started going to the companies’ executives the American public got angry. I think it’s a good thing that the SEC has decided to step in because it is nice to know that someone is working on the side of the public…even it is for their own public relations image or to try to damage a company that has embarrassed the system.

Yes, I really do think that Bank of America has done a pretty good job of embarrassing itself and the entire financial system by pulling this very “AIG” move. BofA is really damaging its own reputation with customers and potential customers alike. Anyone who may be a potential customer will probably be so disgusted by the company’s business practices that they will likely turn away and not think twice about banking with the company or getting a credit card through them.

Bank of America is also notoriously bad with current customers as well. Just think about all the stores that have been coming out on TV regarding banks charging overdraft fees over and over against customers; most of the time the bank is BofA. Also, it is in the middle of the “interest rate hike” controversy where the company is raising interest rates for credit card holders and charging the higher interest on previously held balances.

They have yet to do this to anyone I know, but I am fairly skeptical about the company because of all the bad press it has been getting. I am more unwilling to work with the company than I was a year ago, even a month ago. Since the news about the executive pay has surfaced, I’m sure the company has lost a lot of its clientele.