By James Clingman
Remember the old movies where the outlaws robbed banks for a living, or the gangsters did “bank jobs” as they moved from town to town? Noted bank robber, Willie “The Actor” Sutton is said to have responded to the question, “Why do you rob banks?” by replying, “Because that’s where the money is.” Indeed, banks are where the money was and still is.
There was a time in history when men and women made careers and established reputations by robbing banks for various reasons. Now the tables have turned; in many cases, banks are now robbing the people, no doubt under the same rationale that Willie Sutton used: “That’s where the money is.”
In many cases, your friendly local bank of the past has now become a monstrosity bent on squeezing every dime out of you. Recent reports cite ATM fees as high as $4.35 and overdraft fees average $32.74. Banks earned $32 billion in overdraft fees in 2013. I guess they say if the airlines can do it, with their a la carte charges, so can banks.
Some banks have become robbers of the poor and refuges for the rich. They have grown into bastions of powerful competitive bullies vying to see who can charge the most, rather than the least, for their services. If you are fortunate enough to be “accepted” as a customer, after having been subjected to a battery of questions that would make the Inquisition look like child’s play, you are then subject to a myriad of charges and fees.
There are transaction fees, analysis fees, usage fees, over-usage fees, excess deposit fees, teller fees, and a host of others that make your monthly statement look like your local phone bill. Banks pay you less than 1 percent on your savings accounts while they earn far more on the money in your account. They charge 20 percent interest on your credit card balances and frequently will not approve your small business loan request.
Maybe banks are paying us back for being robbed in broad daylight by bold, brash, unremorseful fortune-seekers, by morphing into those same kinds of characters. They are so greedy and so arrogant with their greed and actually flaunt it for all to see. Remember when ATM’s came on the scene, how they were marketed as “conveniences for our valued customers.” Of course we were all willing to pay an extra 50 cents per transaction. But at $4.35 per out of network transaction, as for me, they can keep their ATM “convenience.” By the way, my hometown, Cincinnati, Ohio, has the nation’s “lowest” ATM fees, around $3.
Here’s the deal. A few years ago, banks that committed crimes were deemed “too big to fail” and were given billions in taxpayer dollars for their efforts in the subprime housing market, which had the greatest negative impact on Black people. They soon became known as “too big to jail” as our Justice Department refused to prosecute any of the perpetrators for the biggest heist in history – a heist that makes Willie Sutton look like he was robbing piggy banks.
But what else should we expect from a political system that is run by a larger, more powerful economic system? When the word went out from the bankers to the politicians to leave this issue alone, it reminded me of MC Hammer saying “Can’t touch this.”
What can we do to prevent ourselves from being robbed? Well, it’s relatively simple. First, be informed; read the rules and notices sent by your bank so you aren’t surprised by the charges. Do not allow your account to become overdrawn; get overdraft protection by agreeing to have the bank transfer money from your savings account to your checking account. (You do have a savings account, don’t you?)
Do not withdraw more than you have in your account from an ATM. That will result in an instant “loan” at a monumental interest rate. Take enough cash on one withdrawal to prevent having to return to the ATM over and over. Going to the ATM every time you need some cash – your cash, is ridiculous and expensive if it’s out of network. Just keep an “emergency stash” in a secret place.
Never make minimum payments on your credit card, and keep your balance below $1,000. Resist the temptation to charge large amounts that you will not be able to pay back over two or three months. Look for no interest “same as cash” deals.
Banks will rob you of your money, but you can prevent it by doing a few simple things. Be proactive with your money; leverage your money by maximizing your return. Avoid instant gratification purchasing. You can prevent bank robbery by being more responsible with the money you have. Economic empowerment begins at home, not in the ATM line.
Jim Clingman, founder of the Greater Cincinnati African American Chamber of Commerce, is the nation’s most prolific writer on economic empowerment for Black people. He is an adjunct professor at the University of Cincinnati and can be reached through his Web site, Blackonomics.com.