When J.R. Anderson moved back to Oregon from Texas three years ago, he decided it was best to close out his account with USAA Federal Savings Bank.
Do it yourself
Usually, a quick review of your bank statement is enough to ensure there’s no untended business when you leave a financial institution. But you can never be too sure. Local experts and banking executives offer the following tips to get out gracefully and without any surprising balances:
Back it up: Enlist overdraft protection services,
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When J.R. Anderson moved back to Oregon from Texas three years ago, he decided it was best to close out his account with USAA Federal Savings Bank.
Do it yourself
Usually, a quick review of your bank statement is enough to ensure there’s no untended business when you leave a financial institution. But you can never be too sure. Local experts and banking executives offer the following tips to get out gracefully and without any surprising balances:
Back it up: Enlist overdraft protection services, which some banks offer for free. If not, it may be worth paying for a few months of protection to be sure you’ll catch any outstanding checks or debits.
Be on alert: Check whether your bank offers email or text notifications of usage, overdrawn balance or accruing fees.
He followed his banker’s advice and paid off the credit card linked to the account and moved money out of its debit and checking side. Still, he remained a USAA member, which also offers insurance and financial services, meaning he could still log in to the system and see that his phone number and email address were up to date.
So while The Desk suspects USAA’s marketing department has deep knowledge of such customer info, it’s clear to Anderson that the banking side did not.
The 25-year-old Beaverton resident received a call recently from a collections firm attempting to track down $82 for USAA. Puzzled, he called the bank and was told a $30 check had turned up after he’d closed his account. The check was stamped “insufficient funds,” and there it sat for the next three years accruing interest and fees totaling more than $50.
“I’m cool paying the check amount; I mean, I didn’t want any checks to go unpaid,” he said, noting that a bank representative apologized but couldn’t waive the fees. “I don’t think I should have to pay everything else.”
USAA wasn’t willing to discuss Anderson’s account, open or not, with The Desk.
“To protect our members’ information, we do not disclose their account details,” according to an emailed statement by spokesman Peter Casiano. “Two of the ways we meet this objective include providing diligent account monitoring and timely, redundant notification whenever a member’s account is overdrawn or appears to be a fraud target.”
Indeed, Anderson would have appreciated both timely and redundant.
The bank’s statement went on to say that it is its policy to send “multiple notifications to members whose checking accounts enter overdraft status.”
That’s good, because federal law requires banks to issue regular statements for accounts in which money can be deposited or debited electronically, said Bryan Hubbard of the federal Office of the Comptroller of the Currency. Furthermore, laws require banks to include information about any overdraft fees assessed.
Oregon’s Division of Finance and Corporate Securitiesoversees banks with state charters, which USAA does not have. Still, Jacob Mundaden, who manages the agency’s banks and trusts section, said Anderson’s complaint isn’t typical. Rather, he said, customers and banks are typically able to ensure all debits and checks are cleared before closing accounts.
That said, he was surprised the check was marked “insufficient funds.”
“It should have been stamped ‘account closed,'” which is a different designation, he said. “My view is that they shouldn’t be charging him the fines.”
However, unfortunately for consumers, federal law does not prohibit banks from charging overdraft fees on closed accounts. Nor does it set a date for banks to stop clearing transactions on closed accounts. However, it is good to remember that a 2010 law requires banks to get a customer’s approval before charging fees after the bank covers an overdraft on an ATM or debit card transaction.
— Have a complaint? Contact Laura Gunderson