Key Bank USA Complaint - Overdraft is a KEY in Key Bank profit
Resolution Update on 12/19/2007:
just got all my money back, $240, 3 month after! Screw you, KEY BANK, you have no tools against FED's!!!
PORTLAND, OREGON -- I opened Checking Account and Credit Card with Key bank years ago, and one day in 2006, I withdraw $200 cash at ATM overseas. Transaction went trough without any warning, however, I had to pay somewhat $30 fee, and Key bank covers overdraft at that time. I did not like to receive few dollars extra and pay somewhat $30. No one would. I asked Key bank options I have in order to void such “convenience charges” in the future. I was surprised! Key bank “can not” decline overdraft transactions: “we do not do that, we always cover it and charge overdraft penalty for it”. WOW! What a way to make a profit on simple mistakes of your client! I did not want to stay near such trap set by my bank and decided to close account immediately.
At that time I had the same set of accounts with US Bank, where US bank Checking Account linked to US bank Credit Card, and fee is only $10 per total $200 of multiple overdrafts!
But, I did not close Key Bank Checking or Credit Card at that time. Why? Because I got assurance from Key Bank representative that Key Bank can do the same as US Bank! OK, sounds like a plan, I finally will have some use for Key bank credit card (never had any debt on it), plus, Key bank voided that $30 fee, nice!
Again, I outline: According to Key Bank, it will never happen again, since Key bank Credit card is linked to its checking account same way as US bank did, and if any overdraw transaction occurs, it will be funded from credit card up to its limit.
Here is what happened in June.
Jun 2007 I purchased 6 items on Ebay and used Paypal to pay, linked to Key bank checking.
Right after that I got over $200 overdraft penalty charges, which includes multiple overdraft charges per single transaction. Why? Because Key bank checking never got linked to Key bank Credit Card, as promised, whoever promised that “was wrong” and the only way to set Overdraft Protections via dedicated line of credit linked to checking!
I called all numbers, than I actually visited a branch manager, asking why I pay for Key Bank representative mistakes out of my pocket. Everyone was rude. Every conversation was a great insult for me.
On my simple question about what actually these $30+ fees per each overdraft transaction for, I got “for funding your transaction while you have insufficient funds”. But it is a lie again: Key bank did not cover these transactions! Instead, Key bank refuse funding, you try again, and they charge multiple overdraft fees increasing per each attempt to complete the transaction!
One more part: Key bank online system set perfectly to rip people off on overdraft fees. Oh yes, I will explain!!!
Say, online access shows negative -$185 balance, meaning, that without any new transactions since last overdraft took place, customer deposit of $185+ should bring checking balance back to positive. I had no new transactions and deposited $300 immediately, so, I should be fine. No, dead wrong! Because -$185 shown online, was only part of the story, caused exclusively by overdraft fees! Why? Because Key bank charges fees per every overdraft attempt, but none of causing overdraft transactions were actually covered by Key bank, and, none of them appears on the statement in any way, neither as complete, or incomplete, or rejected, or pending etc. They wont show you what went wrong and what is pending! Remember, a year ago, Key bank covered ATM overdraft? Yep, I got cash in my hands! Key bank won’t explain why they charge overdraft fees all the time but did not cover actual transactions at this time.
So, I had five overdraft fees applied to my account which causes -$185 balance alone, clearly visible online. And I had five (!) not covered by Key bank transactions without any reflection on the same statement!
Sure I see -$185, and I immediately deposit $334. I do not see anything else online remaining incomplete.
Next, Paypal, in order to complete the same five transactions, few days later attempts to withdraw again, 5 times! I had enough balance for 4 transactions, And, overdraft happen with the same transaction again, which was not covered once, ($32 fee) and not covered again ($36.50 fee, increased!). Paypal acts the same way as everyone would: if transaction did not go trough you usually slide your card again.
On my question why online system did not sow overdraft attempts and reflects only fees applied, manager says “we mailed you a letter with more details! Do you have any more questions?”
1) A while ago, Key bank representative put a lot of efforts on the table, including misleading information, just in order not to loose another customer. Was it a simple mistake? Maybe, but why I should pay for it now?
2) Key bank online system shows only information they want to show you, outdated, and useless to track the actual situation with your account!
3) Key bank is not an ordinary bank. It is a well oiled rip off system where flexible (not flat!) over $30 overdraft charges apply per each overdraft attempt without completing transaction!
Here is the simple example how you loose $100: you are at the retail sore slide your debit card, say, 2 more times because it did not go trough. It will cost you overdraft fees every time you slide a cad, 3 times equal to over $100 fees, and you still have nothing paid!
4) Unlike with other banks, Key bank overdraft fee you pay for nothing, and it is NOT a flat rate fee, they increase it anytime they want! Because they do not cover actual transactions, their customers most likely will try to slide a debit card multiple times, and overdraft fee will be charged multiple times, increases with every other attempt, before you even know what is going on!
5) Key bank representatives are all extremely rude and uncooperative; they refuse to explain why Key bank charges overdraft fees but only sometimes covers the transactions. I was under impression that they know how it works but it is such a shame that they do not want to talk about it and simply become rude and prefer to hang up the phone!
6) Another shame: friend of mine figured that free checking account which can be open with any balance, subject to $25 fee to close it, if you decide to do so it within 6 month and Key bank won’t tell you that until you actually attempt to close the account!