Bank Scams

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Posted by MJTM | Posted in Financial | Posted on 10-02-2017

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It is very important to trust whoever has access to your money. You work hard for it. When you  think of banks, you would like to think of them as trustworthy institutions since they are responsible for the populations most important valuables. However, in recent history there has been known to be some scandal with banks that causes consumers to question their integrity.

Quota Scam

Bank workers have quotas to meet, they are essentially salesmen trying to earn commission when it comes to opening bank accounts. Some banks have been  known to take it a bit too far and open up accounts and credit cards without clients knowing to meet these quotas. This is what happened at Wells Fargo. Managers were using unethical measures to inflate sales numbers. After the class action suit was filed, it lead to a large number of employees being fired and millions of dollars spent in fines and reimbursements to clients.

PPI Scam

Payment Protection Insurance (PPI) is an insurance that your debts will be paid in the event of a death, lost job, catastrophe, etc. The idea sounds amazing but unfortunately there are businesses which are taking advantage of consumers. Often times, banks can lump these policies in with mortgages, automobile loans and credit cards without even fully informing the client. This is easy to do because all of these items involve large amounts of paperwork. PPI claims as described here can be filed

Many banks have been guilty of this scam, but a major global bank who got caught doing this is Barclays. Barclays have been taking hits on PPI claims for over the past decade.

Fee Scam

Every bank has ways of making money, one of them is through fees. They charge overdraft fees, transaction fees and fees for different services. There are many class action suits filed against large banks because of the unlawful charges or even incorrectly classified charges.

Bank of America recently made a $27.5 million settlement for unfairly assessing overdraft fees on certain debit cards. Bank of America still claims this did not occur but they reached that settlement amount.

When a global bank goes through something like this, it is a publicity nightmare. As I previously mentioned, it makes people not trust their bank and want to move their money elsewhere. Banks are so regulated but it seems that situations like these slip through the cracks.

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