By Scott Rodd / KPBS / November 29, 2023
This is part one of a two-part series.
All told, credit unions chartered in California collected more than a quarter billion dollars in overdraft fees in 2022, according to data collected by the state. A KPBS analysis found state-chartered credit unions based in the San Diego area collected more than $36 million.
Revelations in recent years of onerous fees charged by mammoth banks like Wells Fargo and Bank of America have led to lawsuits and government crackdowns. But unlike commercial banks, not-for-profit credit unions haven’t had to disclose revenue generated from overdraft penalties.
For example, San Diego County Credit Union charges $32 per overdraft and last year generated $18 million in revenue from the fees.
That changed in California this year, following the passage of a first-of-its-kind law requiring the collection of this information. A report released by the state Department of Financial Protection and Innovation (DFPI) provides a revealing snapshot of how certain institutions depend on the fees. The KPBS analysis found overdraft fees at several San Diego area credit unions amounted to at least half of their net income. In one case, an area credit union’s financial records indicate it could have lost money last year without revenue from overdraft penalties.
Overdraft fees disproportionately impact customers living paycheck to paycheck, since they’re more likely to have low checking account balances. Banking watchdogs said excessive overdraft penalties effectively punish people for being poor.
For the balance of this article, please go here.
Might seem like a crazy suggestion – Don’t write a check for which you do not have the funds.
Kind of like don’t make a promise you can’t keep
Congress should pass a law that says if you want to keep your tax exempt status ,then you cannot charge overdraft fees. Banks have always hated credit unions because they think that tax exempt status is unfair competition. If you’re gonna scam your customers just like banks, then you should pay taxes just like banks.
It’s predatory lending. We used to call these folks back a bit East. Pond scum. Except there isn’t really any ponds here here. So… scum.
The idea that they help in naming anything is ridiculous. It’s predatory lending. Kind of father rapers, See Alice’s Restaurant. We are alllll on the group W bench. That can be viewed here : https://youtu.be/b0a6iWHSWbA?si=GNKWll8NdEKxTzzA
Where is the list to view the results?
Also, Deb. You done not know it works.