An overdraft occurs when there is not enough money in an account to cover a transaction, but the bank or credit union pays for it anyway.

Many financial institutions offer overdraft protection programs, but some of these overdraft practices have been called into question regarding excessive fee charges or reordering of transactions, including the overdraft practices at UMB Bank.

Overdraft Practices at UMB Bank

UMB Bank’s website states that they offer three different options for customers who do not have enough money in their checking account can be covered for their purchases.

The first is a standard overdraft protection they call TotalCheck that, if approved, can be added to the customer’s UMB checking account.  Similar to a credit card, TotalCheck advances are for the exact amount that the account is overdrawn, and bring the account to a $0 available balance.

Customers can also link their UMB credit card to their checking account as a form of overdraft protection, with advances to cover any checking overdrafts occurring in $100 increments.

Additionally, overdraft practices at UMB Bank include the option of account to account transfers for customers who have multiple accounts, with transfers occurring in $25 increments to cover an overdrawn account.

However, overdraft practices at UMB Bank and other financial institutions may be deceptive, with many touting overdraft protection as a beneficial service to the customer, when in fact, some of the fees that can be accrued can cause significant financial damage to a customer.

In fact, when customers visit UMB’s website, the actual fees associated with their three overdraft protection programs are not displayed on the information page. Instead, customers are given a link to click at the bottom of the page to learn more about fees and overdraft practices at UMB Bank.

Upon clicking this link, customer can then see that for TotalCheck and Account-to-Account Transfer Overdraft Programs, a $10 fee for overdrafts over $5 are assessed, and a maximum of $25 for Credit Card Overdraft Protection transactions.

Overdraft Protection Is Optional

Since July 1, 2010, financial institutions must ask customers to choose overdraft protection rather than enroll automatically. Yet despite this and other federal rules on overdraft fees that went into effect in 2010, many financial institutions are still using deceptive overdraft practices including:

• Misleading marketing of overdraft programs that are designed to increase overdraft fees, while referring to those practices as “overdraft protection”.
• Reordering transactions from high to low order in order to increase the number and amount of overdraft fees when the account is overdrawn
• Providing inaccurate balances to customers leading them to unknowingly overdraft their account
• Delaying the processing of deposits

Were You Charged Excessive Overdraft Fees by UMB Bank?

In 2010, overdraft practices at UMB Bank were called into question when a Missouri resident filed a class action lawsuit against the bank alleging that the overdraft practices at UMB bank were unfair and deceptive.

The plaintiff claimed that UMB charged him 17 overdraft fees, each in the amount of $36, over a single weekend. This included a $36 overdraft fee on a eighty-five cent purchase. UMB then charged the plaintiff additional overdraft fees and negative balance fees after these 17 fees depleted the hundreds of dollars of available funds in his account.

This class action lawsuit was settled for $7.8 million in May 2011.

Consumers who suspect they are being overdraft practices at UMB Bank or another financial institution are improper or excessive may want to consider speaking with an attorney who can help determine if the charges were proper or improper and advise about possibly bringing an overdraft fees lawsuit.

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