What practices are banks allegedly using to increase the likelihood customers will overdraw their accounts?
Banks do not record charges and purchases on ATM or debit cards in the order they occurred. Instead, banks reorder the charges and purchases so that the largest charge or purchase is the first one paid by the bank. This practice usually increases the number of times a customer will incur an overdraft fee, and thus increase the amount customers in overdraft fees. In addition, it has been alleged that certain banks deducts the cost of purchases made on debit cards from the balance of the checking account before they credit deposits made on the same day, again increasing the likelihood the account will become overdrawn.
