HIGHTOWER: Cash Cows for Bankers
You've got your milk cows (moo), your sacred cows (moo-mooooo) ... and then you've got your cash cows (ca-ching!).The cash cows that keep on delivering for today's banking world are those beeping, glowing, computerized critters called ATMs. Typically, a big bank will charge its own customers $2.50 to withdraw money from their account through these machines. In addition, though, the bank owning the ATM will hit you with a surcharge of another buck-fifty for simply using the machine. So you're out $4 to withdraw maybe $20 -- a 20 percent hit to have access to your own money!This is why there's a national rebellion against this electronic gouging, including a recent voter initiative in San Francisco to outlaw the outrageous surcharges. Despite a media blitz by the banks, the initiative passed by almost a two-to-one margin. Immediately after the voters spoke, however, Bank of America and Wells Fargo, the area's largest banks, filed suit to overturn the democratic process, claiming that local people should have no say over the fees charged by nationally-chartered banks.In their court filings, however, the two giant banks revealed what a ripoff these surcharges really are. Bank of America is hauling off some $250,000 a month just for the surcharges in San Francisco, and Wells Fargo is taking $210,000 a month. In the pleadings, the bankers whine that they could not possibly keep the ATMs on the streets without charging this $1.50 add-on per transaction. But Newsweek magazine reports that the actual cost to the banks for handling an ATM transaction is about a quarter. In other words, the banks are making a 500-percent profit every time you pay their surcharge to draw money from your own bank account.This is Jim Hightower saying ... ATMs are supposed to be convenient cash machines for bank customers ... not cash cows for bankers.