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Bank Refuses to Curb Abuse of Elderly
My widowed seventy-eight year old mother was threatened in 3-09 by a debt collector that she would lose her house if she did not pay an invoice she did not owe. Out of fear, she gave the debt collector her bank account information and a check number. After she realized what she did, she contacted the collection company the next day and they assured her that they would not process the amount. The next day she walked into her bank and told them to not authorize the payment. She even explained that they threatened her to obtain the information and she contacted (via phone) the company to revoke it. The bank told her that there is nothing they could do, since she had already given the debt collector authorization to withdraw the amount. Five days later, her account is charged by the debt collector and her bank account becomes overdrawn with fees. Upon receiving the overdraft notices, she walked into the bank, filed a dispute on the
charge, and requested a refund of NSF fees. The bank again told her that there is nothing they could do, since she authorized the charge the first time, regardless if she contacted them revoking it, or how they obtained her bank account information. Can the bank refuse a stop payment on the check? Can the bank refuse to investigate her dispute after the bank clears the check?
Also, prior to this event, the original creditor would bill irregular amounts each month from her bank account. She contacted the company multiple times to complain, request refunds and cancel service, all to no avail. She went to her bank on several occasions to request them to stop payments to this company. Again, the bank's response was that there is nothing they can do, as she had authorized the withdrawals and only the vendor could stop billing her account each month. Can the bank refuse to place a stop payment on the monthly withdrawals?
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 Your mother always has a right to place a stop payment on checks or electronic payments scheduled to be charged to her account. That's simply a right, and the bank was wrong to refuse her request. She is also entitled to provide the bank with documentation that she revoked a standing authorization for ACH (automated clearing house) or other electronic payments and to demand that the bank block all future such payments to that creditor/company.
Frankly, it may be difficult to convince your mother's bank of its responsibilities, given the history in your question. We suggest that your mother vote with her feet and take her business to a bank that understands its obligations under the law.
Published on BankingQuestions.com 7/14/10
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