Westpac - Crooks?

Please note this sub-forum does not provide professional finance advice. You should seek advice from a licensed financial advisor.

To post in this sub-forum you must have made 100 posts or have Trust status or have completed our ID Verification.

If investing please consider our affiliate link for new accounts: Sharesies.

Forums › Finance and wealth management › Westpac - Crooks?

madman

93 posts

Master Geek
Inactive user

#15055 1-Aug-2007 18:51

My bank is Westpac, I've been with them since 1988. I have multiple accounts, one of them is an 'Active' account which I haven't used for months, the balance on July 30 was $1.06. On July 31 I had - Account maintenance, Phone banking and Transaction fees taken out and on top of that $0.10 of interest taken from the account also, which left my account overdrawn. The same day (July 31) I was charged a $25 overdraft penalty, when I realised this today I thought an error had occurred or something because the balance had been $1.06 since February. Immediately rang Westpac to see what was going on, explained what had happened to a customer service guy who thought this was very odd, he put me on hold for around 5 minutes while he spoke to a colleague, he could not explain to me why fees had been taken from my account when it had been inactive for months and why I was charged an overdraft penalty instantaneously, he then said the fees and overdraft penalty would be credited to my account which would bring the balance back to $1.06 - 'out of good will'. It was there fault, they had no explanation and then said it was out of good will, couldn't believe it!

I wonder if this has happened to anyone else or if it was a one off mistake?

Alex

Bung

6477 posts

Uber Geek

Subscriber

#80767 1-Aug-2007 19:17

According to Westpac's list of fees an Active account has a Monthly account maintenance fee of $3.50. How have you kept the balance so low for so long?

madman

93 posts

Master Geek
Inactive user

#80769 1-Aug-2007 19:19

I have no idea. It has been that way since I stopped using the account. I lived in Australia for 8 years, during this time I was never charged any fees on the account.

Nightwyrm

588 posts

Ultimate Geek

Trusted

#80773 1-Aug-2007 19:40

Bit harsh calling them crooks for what appears to be a simple system error. Though I work for another bank, I can say that sometimes a simple thing like updating a fee structure (guessing here as the site says fees current as at 1 August 2007) could have debited some accounts in error. Of course, it's a product that's no longer offered which may have caused a bug. At last they're not disputing it and are crediting you.

The overdraft penalty is easier to explain. Accounts usually have shadow limits dependent on what your internal credit rating (calculated on account behaviour) within the host system is. As your account has been dormant for a while, your internal credti rating will be at a point where you have a zero shadow limit. Therefore, as soon as you go over, you're hit with the penalty fee. At least, that's how it works at my bank.

Out of interest, why not close the account?

Post-geek, opinionated mediaphile, and natural born cynic. Jack of all genres, master of none.

madman

93 posts

Master Geek
Inactive user

#80775 1-Aug-2007 19:49

Very interesting, I didn't know that.. thanks! Yes a little bit harsh but I was annoyed, what would have happened if I had paid the penalty, would they have realised it was an error? I probably will close the account now. Thanks for the information

antoniosk

2358 posts

Uber Geek

ID Verified

Trusted

Lifetime subscriber

#80777 1-Aug-2007 20:18

Interestingly, the UK banks were penalised by the Financial Services Authority (FSA) for overcharging penalties on overdrafts. HSBC took a charge of £400m and had to refund customers a wodge of cash as a result.

The issue is that it's automated and you have to beg to get it back; I did this many times as I would blow my OD by £1 or £2 every so often, but given the rest of money I had with them they always credited back. But it was a pain to do it each time.

________

Antoniosk

madman

93 posts

Master Geek
Inactive user

#80779 1-Aug-2007 20:23

That's why I was annoyed also. If my account was overdrawn legitimately I would have credited it in a day or so but I wouldn't have been given the chance..

n00dy

482 posts

Ultimate Geek

Lifetime subscriber

#80784 1-Aug-2007 20:49

Not with westpac, but my daughter was charged an "honour fee" by a bank for allowing her to go into overdraft, she had 2 accounts, one for use and one for savings, she only uses eftpos and thinking she had enough funds in her working account made 3 purchase via eftpos and they went through, when she checked her account the next morning 3 x $25 honour fees. We contested this with the bank & their repsonse was they "honoured" the eftpos trans to save us the embarrassment of it declining, it is a "SERVICE" they provide however it costs you $25 each transaction. WHAT!!! we would have prefered the embarrasment, we said we never asked for the "service" and want the account set to decline eftpos transactions when there is insuffiencent funds in the account. She went to the bank & they wouldnt do anything, I went down there and said they should rethink the fee, they offered to credit 2 of the service fees however said they can only reverse 2 per day so the other had to remain. Yeah right. We found out that if you have an account that has money in it the system will allow the other account to go into OD even though you dont have an OD but they charge you plenty & they know you can pay it cause there is money in the other account.

Equinox IT

Cloud spending continues to surge globally, but most organisations haven’t made the changes necessary to maximise the value and cost-efficiency benefits of their cloud investments. Download the whitepaper From Overspend to Advantage now.

Nightwyrm

588 posts

Ultimate Geek

Trusted

#80785 1-Aug-2007 20:55

madman: what would have happened if I had paid the penalty, would they have realised it was an error?

Sometimes we can pick these errors up ourselves through various means and correct them, but more often we don't know until the issue is raised. Unfortunately, we're not perfect.

Post-geek, opinionated mediaphile, and natural born cynic. Jack of all genres, master of none.

madman

93 posts

Master Geek
Inactive user

#80786 1-Aug-2007 20:59

n00dy: Not with westpac, but my daughter was charged an "honour fee" by a bank for allowing her to go into overdraft, she had 2 accounts, one for use and one for savings, she only uses eftpos and thinking she had enough funds in her working account made 3 purchase via eftpos and they went through, when she checked her account the next morning 3 x $25 honour fees. We contested this with the bank & their repsonse was they "honoured" the eftpos trans to save us the embarrassment of it declining, it is a "SERVICE" they provide however it costs you $25 each transaction. WHAT!!! we would have prefered the embarrasment, we said we never asked for the "service" and want the account set to decline eftpos transactions when there is insuffiencent funds in the account. She went to the bank & they wouldnt do anything, I went down there and said they should rethink the fee, they offered to credit 2 of the service fees however said they can only reverse 2 per day so the other had to remain. Yeah right. We found out that if you have an account that has money in it the system will allow the other account to go into OD even though you dont have an OD but they charge you plenty & they know you can pay it cause there is money in the other account.

That is definitely not on! very sneaky if you ask me, just think of how many people don't do anything in this situation.. really gets me going!

Nightwyrm

588 posts

Ultimate Geek

Trusted

#80794 1-Aug-2007 21:17

n00dy: my daughter was charged an "honour fee" by a bank for allowing her to go into overdraft

I have to say that I (and a large number of people in my organisation) don't agree on nor understand the principles of honour fees. Admittedly, one brand of our organisation does charge these but to a max of $10 per day, not the pretty heinous fee your daughter was charged. From the sounds of it, this may be their way of charging people for going into a shadow limit.

In this day and age, all fees that can be charged by a bank should be available to the public - that's how we all got pinged for those "hidden" credit card charges by the Commerce Commission. When looking at opening an account, look at all potential chargeables - most will be similar across the different banks but not all have fees like these. However, the thing to remember is that we don't make our big money from fees like these but from lending interest (e.g. home loans, credit cards, business loans, etc.) and trading - that's why some of us are happy to refund disputed fees, but again each bank is different.

/me avoid gratuitous plug for my workplace

Post-geek, opinionated mediaphile, and natural born cynic. Jack of all genres, master of none.