Big Bankers Mounting Sneak Attack on Consumers

Have you received your thank-you note? I'm still waiting for mine.

More than a year into the Wall Street bailout, I've yet to get any sort of "thank you" from even a single one of the big banks that you and I propped up with $12 trillion in direct giveaways, indirect giveaways, government guarantees and sweetheart loans. You'd think their mommas would've taught them better. But I've begun to think that waiting on a simple gesture of banker gratitude is like waiting on Donald Trump to have a good hair day -- ain't gonna happen.

Far from showing appreciation, the largest banking chains are now going out of their way to stiff us. Instead of nice notes, they are quietly slipping new gotchas into our monthly credit card bills and bank statements. In June, for example, Bank of America abruptly raised its fee for a basic checking account by 50 percent. Citibank jacked up the interest rate on some of its cards to 29.99 percent. And JPMorgan Chase more than doubled the required minimum payment on its cards.

Across the board, fees have skyrocketed to their highest levels on record, including assessments for such common occurrences as overdrafts (as high as $39), stop-payment actions ($39 -- double what it was 10 years ago), balance transfers (up more than 50 percent in the past year) and ATM use (nearly doubled in 10 years).

To add insult to injury, the banks blame us for their rate increases. Because the economy is such a wreck (massive job losses, falling incomes, millions of home foreclosures and other unpleasantness), industry spokesmen say there is a greater risk that customers will bounce checks or fall behind on their credit-card payments. Thus, claim purse-lipped bankers, they must protect themselves from us by ratcheting up rates and fees. "There is an increased riskiness around repayment because of the recession," spaketh one lobbyist for the financial giants.

Glade doesn't make enough "Spring Lilac" to cover up the stench of this argument. Come on -- it was the greed and incompetence of Mr. Jolly Banker that wrecked our economy, caused the recession and forced the odious bailout on us. They want us to pay for that?

The truth is, they are socking it to their customers for two reasons: 1) they can, and 2) fee hikes are a shifty way to snatch enormous levels of new income for themselves without doing anything to earn it.

These are the geniuses who made an ugly mess of the core business of banking -- which is to make good loans. To make up for their huge losses in that business, bankers have essentially been reduced to flim-flam fee-scammers. Last year, assessment of consumer fees became the main business of banks, totaling 53 percent of the industry's income!

That was before the current outbreak of fee frenzy. In the first three months of this year, for example, Bank of America's fee income rose 50 percent above the same period of 2008 -- an extra $4 billion in revenue for the bank.

"Fees 'R' Us" is what big banks have become. This is why they are panicked by reforms presently coming out of Washington. Already, President Obama has signed a bill to restrict credit-card gouging, and Bank of America, Citigroup and JPMorgan (which control about 58 percent of the nation's credit-card market) are scrambling to jack up their rates and fees before the new law takes effect next February.

Now, the bankers are lobbying frantically to kill Obama's plan to create a Consumer Financial Protection Agency, which would have regulatory power to prohibit a wide range of finance-industry abuses. For the first time, we consumers would have our own seat at the regulatory table -- an agency with the independence and clout to counter the Federal Reserve and other agencies that primarily serve big banks.