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Anger against mega-banks brewed for most of last year, coming to a head with the Occupy Wall Street protests and fueled by banks’ unpopular (and short-lived) efforts to charge people for using their debit cards. People claimed they’d vote with their feet and switch to a smaller bank or a credit union, prompted by movements like the Facebook-driven Bank Transfer Day. But then a funny thing happened: Most people didn’t wind up switching banks after all.

Does this mean we’ve embraced the “too big to fail” banks? Far from it; a pair of new studies show widespread dissatisfaction among customers of giant banks.

Overall, 11% of bank customers say they plan to switch banks, according to Javelin Strategy & Research, but this number is higher — in some cases, much higher — for the nation’s largest banks. Javelin says an “astounding” 25% of Citibank customers and 21% of Bank of America customers in a recent study say they’re likely or very likely to change banks within the next year. For Wells Fargo and Chase, those figures are 14% and 12%, respectively.

Only 69% of people say they’re satisfied with service at big banks, a lower percentage than for regional banks, community banks or credit unions (which have the highest satisfaction rating at 92%).

As fraught as our banking relationships are in the U.S., though, Europeans seem even less satisfied with their financial institutions. In a survey of global banking customers, consulting firm Ernst & Young found that consumer confidence in banks in Spain and Italy dropped by more than 70%. Worldwide, its research showed similar sentiments to Javelin’s study, with 12% of customers planning on leaving their banks. Half of these departing customers plan to leave because of fees and other costs.

So, if we hate our banks so much, why are they still our banks? For some people, it’s probably just inertia: It takes time and effort to choose and switch to a new financial home base. And there’s the devil-you-know dynamic: Some cynical customers may figure that another bank could be just as bad, or worse.

Then there’s another, even more frustrating, reason: Consumer Reports recently looked at what it takes to move to a different financial institution and found that it’s not only very difficult, but deliberately so, especially if you use a lot of automatic deposit and payment services. Consumers Union found that even basic details such as whether or not a customer can close an account via phone often aren’t readily available, and that customers often get conflicting answers. A customer also runs the risk of incurring insufficient funds fees or monthly maintenance fees while they’re drawing down the balance of their old account. http://moneyland.time.com/2012/07/05/after-the-occupation-we-hate-mega
-banks-but-still-use-them/, of course, they're still making money hand-over-fist on our money, with overdraft fees being a big money-maker for them:

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Do more complicated overdraft fee structures help or hurt customers — or just drive them crazy?

Banks still want to make money on overdraft fees, and to a large extent, they still do. Although the $31.6 billion in overdraft revenue banks earned last year is down from the industry high of $37.1 billion in 2009, banks are still pulling in huge money more than a year after laws went into effect designed to limit bank customers’ exposures to these fees.

If you don’t see how that makes a lot of sense, you have company: Regulators think so, too. In February, the Consumer Financial Protection Bureau began an inquiry into overdraft fees to find out if the ways banks market overdraft programs and process transactions that trigger overdrafts are on the up-and-up or deliberately sneaky.

“We are concerned that overdraft practices employed by some banks unnecessarily increase consumer costs by making it difficult to anticipate and avoid fees,” he said then in a statement. http://moneyland.time.com/2012/06/29/banks-overdraft-policies-getting-
more-confusing/]
So how are banks still making so much money off overdraft fees? The Fed rules had a loophole that said customers could overdraw and be charged the fee if they opted into it. This sounds pretty cut-and-dried, right? Who’s going to say, Sure, let me run a negative balance and sock me with a $30 fee every time I swipe? Actually, a lot of people. Before the regulations kicked in, banks went full throttle with marketing campaigns designed to get consumers to opt in — mostly by confusing the heck out of them.

The Pew Charitable Trusts and the Center for Responsible Lending conducted surveys and focus groups and found that a lot of bank customers thought they had chosen the option that avoided overdraft fees, when they had actually done the opposite.

In February, the CFPB announced an investigation into overdraft practices, but it didn’t call out any specific banks. The move was applauded by watchdog groups like Consumers Union, which urged the agency to put the kibosh on banks’ marketing doublespeak. At the time, CFPB director Richard Cordray said bank customers “may have been misled by marketing materials that suggested opting in to overdraft protection was necessary if they wanted to continue to use their debit card. Or maybe they saw one-sided advertising that emphasized the benefits of overdraft while burying information about the costs.”

Bloomberg’s sources say the CFPB is looking at how overdraft programs were presented to determine if banks went out of their way to mislead customers. It’s scrutinizing print mail and online marketing as well as scripts that customer-service personnel were given. It’s also looking into why banks charge so much for overdrafts, and if that $30 average — it’s $33.50 at big banks, according to Moebs — is appropriate. http://moneyland.time.com/2012/04/23/cfpb-reportedly-scrutinizing-bank
s-overdraft-practices/

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I can hear our self-righteous righties now saying pompously "If you get overdraft fees, it's your own fault for overdrafting". Easy to say when you can afford it, and of course the poor person who has to pay rent despite being hit with car repairs that allow them to get to work at their less-than-sufficient-wage job should just go to hell (or debtor's prison).

Everything business does, even if it's immoral: Good
Everything government does, even if it's KEEPING business from doing immoral things: Bad

We know the routine.

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Banks are still allowed to practice illegal foreclosures

Banks are foreclosing on homeowners left and right these days, but how are they allowed to do this when the only thing they’ve brought to the negotiating table is ink? Before we can begin to grasp the concept of illegal foreclosures and the diabolical nature of the world banking system, we have to understand how banks are allowed to create money out of thin air.More at http://www.examiner.com/article/banks-are-still-allowed-to-practice-il
legal-foreclosures Still Imposing Illegal Fees

The Consumer Financial Protection Bureau has begun to examine the collection practices of big credit card issuing banks. As with many off their business practices major banks push “the envelope” when dealing with consumers and especially when credit cards are involved. This fact is evidenced by recent attempts by big banks to impose fees for debit card use, “robo” signing of foreclosure documents, improper disclosure regarding real estate loans, etc.

According to a recent article by Joe Nocera published in The New York Times big banks, as reported in The American Banker, are using harsh debt collection practices to collect outstanding credit card accounts. According to Mr. Nocera major credit card issuing banks have not stopped using the “shoddy, often illegal practices” that caused the foreclosure crisis; they’re using them to collect credit card debt”. He goes on to point out that their, “practices hurt primarily the poor and the unsophisticated”.

The New York Times article goes on to say that that banks hire law firms to sue supposedly overdue borrowers, or sell the debt to third parties many times based on inaccurate or incorrect records. He says that “the banks are outsourcing their dirty work—and then washing their hands as the debt collectors harass and sue and make people miserable, often without proof that the debt is owed.”More at http://www.associatedattorneys.com/9056/major-banks-are-still-at-it/ Shows Capital One Bank Illegally Filed $24.7 Million in Claims for Debts Previously Discharged in Bankruptcy

One can understand if a major U.S. credit card company forgets that one of its customers had earlier written off that company’s debt in bankruptcy. But forgetting this very important fact for 15,500 of its customers?!?

It is bad enough that Capital One lost track that its old debts had been legally written off (“discharged”). But in each one of these 15,500 cases it didn’t bother to check if the debts were discharged, and so it actually filed documents in subsequent bankruptcy cases asserting that the debts were still legally owed. Each of these “proofs of claim” were dated and signed by a Capital One representative, with the signature right next to this statement: “Penalty for presenting fraudulent claim: Fine of up to $500,000 or imprisonment for up to 5 years, or both.”

Obviously, a creditor filing a document in a bankruptcy case saying that it is owed money when it not is in violation of the bankruptcy laws. Doing this in 15,500 cases is majorly bashing the integrity of the bankruptcy system, and causing havoc to “case administration.”More at http://www.bankruptcyattorney-lasvegas.com/blog/audit-shows-capital-on
e-bank-illegally-filed-24-7-million-in-claims-for-debts-previously-discharged-in-bankruptcy/ Chief Bob Diamond Grilled Over Rate-Fixing Scandal

Bob Diamond, Barclays’ former chief executive, appeared before Parliament’s Treasury Select Committee on July 4. The hearing came just one day after Diamond resigned from his position amid the fallout of the ongoing Libor rate-fixing scandal. During today’s three-hour grilling, committee members questioned his competence, suggested he forgo any expected bonuses and payouts and took swipes at his integrity. Perhaps owing to a wooden demeanor, Diamond appeared to keep his cool—even as the line of questioning grew more fiery as the day progressed.

At times he sounded more like the star of a Barclays infomercial than an embattled businessman. He frequently turned the hearing—which coincides with what would have been his 16th anniversary working with the firm—into a sugary tribute to his former employer. “I love Barclays,” he said in his opening remarks. “I love Barclays because of the people. It’s been 16 years of tremendous enjoyment. I worry the world looks at Barclays through a few group of traders who had reprehensible behavior….That’s not representative of the Barclays I know.”

But the Barclays the world has come to know in recent weeks is one where bankers manipulated the London Inter Bank Offering Rate (Libor) — to which many adjustable mortgages and other consumer rates are pegged — in order to boost profits at the bank. According to the Financial Services Authority, which has previously investigated the matter, those actions took place as early as 2005 and carried on through 2007, with scattered occurrences in 2008 and 2009.More at http://world.time.com/2012/07/04/ex-barclays-chief-bob-diamond-grilled
-over-rate-fixing-scandal/ going to stop them, is it? Especially with government on their side...when can we expect the next crash, I wonder?