One of the financial industry's worst penalty fees is making a comeback.
FORTUNE -- The financial crisis was supposed to spur a new era of frugality and fiscal responsibility. It doesn't exactly appear to be working out that way.
Americans are once again increasingly overspending what they have in their checking accounts. In all, consumers were hit with $31.5 billion in so-called overdraft fees by banks in the past year, according to a new study from bank research firm Moebs Services. That compares to $30.8 billion in the same period a year before.
That was below the peak of $36.8 billion in the same period in 2008. But this year is still the first time overdraft fees have risen since the financial crisis. From mid-2008 to mid-2011, the number of times consumers were hit by overdraft fees had fallen by roughly a third. Now in the past nine months, the levying of overdraft penalties appears to be on the rise again, up 10% in the past nine months.
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The question is whether this a a result of shady bank practices or poor money management. On the margin, it appears that overdraft fees have gotten a little more fair. Banks have shelled out hundreds of millions to settle claims that they re-ordered consumer purchases in order to trigger overdraft penalties as often as possible. And the Card Act made it illegal for banks to automatically enroll customers in overdraft protection, limiting the number of people who get hit with fees they didn't even know about.
There's probably still more work to be done to make these fees fair. Earlier this year, the Consumer Financial Protection Bureau said it was looking into way banks impose overdraft fees. Clearly, the pricing of overdraft fees, which average $30 per penalty, by banks still seems unfair. A similar loan from a payday lender would run you $17, according to Moebs.
But the most unfair thing about these fees might not
http://finance.fortune.cnn.com/2012/09/26/overdraft-fees-rise/?iid=HP_LN
Realist - Everybody in America is soft, and hates conflict. The cure for this, both in politics and social life, is the same -- hardihood. Give them raw truth.
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