The GAO issued a report recommending that the federal banking agencies assess the extent to which customers receive deposit account disclosures on fees and account terms prior to opening an account and incorporate into their oversight, as needed, steps to assure that disclosures are made available.
In its report, the GAO notes that average fees for insufficient funds, overdrafts, returns of deposited items, and stop payment orders have risen by 10% or more since 2000, while others, such as monthly account maintenance fees, have declined. During this period, the portion of bank income derived from noninterest sources—including fees on deposit accounts—varied but increased overall from 24% to 27%. According to the GAO, the federal banking agencies received relatively fewer consumer complaints about deposit account fees and disclosures—less than 5% of all complaints from 2002 to 2006—than about other bank products. During the same period, the agencies cited 1,674 violations of fee-related disclosure laws—about 335 annually among the 17,000 banks they oversee.
GAO staff members visited close to 200 branches of 154 banks. The report concludes that these visits suggest that, despite Truth in Savings Act disclosure requirements, consumers may find it difficult to obtain information about deposit account fees. GAO staff posing as customers were unable to obtain detailed fee information and account terms at over one-fifth of visited branches and also could not find this information on many banks’ websites.Click here for a copy of the report.