These days you hear a lot about government regulation. Some seem to think we don’t need any or at least a lot less, but I’m not one of those. I can tell you from experience that I am very glad we have the regulations we do.
Here’s my story. One day I went to my bank, a big well-known bank now defunct, to deposit a lot of money. I had sold a property and cashed out some bonds, so I had cash in different denominations mixed with checks. Apparently, this was confusing for the bank because it took awhile to get everything organized, give me my receipt and send me on my way.
Then, big surprise at the end of the month, the bank sent me a notice saying in totaling their books for the day of my deposit, they had come across a shortfall of several thousand dollars and had, therefore, debited my account! What?! My account? What was I–the most convenient target?
Of course, outraged, I confronted the bank people who politely informed me in their best bureaucratese that their hands were tied, all decisions were final and blah, blah, blah–bottom line, dearie, in our tag game–you’re it and we’ve grabbed your money.
Thankfully, the bank was federally-chartered, so I checked out the regulatory agency and immediately filed a complaint about the bank’s actions. It all seemed illegal to me, but maybe it did have the right to seize my assets.
To make a long story short, it took a while and a couple of letter, but eventually the federal agency took care of me. Apparently, the agency sent the bank a sharply-worded reprimand because, shortly afterward, I received a nice letter from the bank inviting me to come in and review my account. And, most delightful of all, my account had been credited with the exact amount the bank had seized from me in the first place.
As you can imagine, I did make a quick trip to that bank, but not to chat with the administrators. No, my trip was to withdraw every penny I had in that bank as quickly as humanly possible and put it into another bank the very same day.
We’ve all heard stories about the old days when people stashed their money in their mattresses or under their mattresses, I’m not sure which, because they didn’t trust banks. Those stories came from the Great Depression, I believe, before banks were regulated and when banks were regularly failing without recompensing their depositors. In those days, if your bank went down, you lost everything you had in there.
This is why I believe in regulation. Big banks, companies, what-have-you will do whatever to us, the poor consumers, unless someone even bigger, in this case the U.S. Government, is there to prevent them and protect us.
For more information about how to protest the actions of a bank, check out this informative brochure from the Federal Reserve-http://www.federalreserveconsumerhelp.gov/ConsumerHelponline.pdf