The road to corporate greed is paved with nickel-and-dime bank charges.
Want a paper statement? That'll cost you a few bucks. Not making enough deposits or withdrawals? That'll result in an inactivity fee of as much as $10. Don't meet minimum balance requirements? Here's your monthly $25 account maintenance fee.
But the returned-check fee might take the cake.
Brian Baltow of Thousand Oaks recently received a check from a client for $120. Unfortunately, the check bounced.
Baltow's bank, Bank of America, returned the check to the guy who wrote it. And it dinged Baltow with a $12 fee.
"They said it was my responsibility to check that the person writing the check had sufficient funds in his account," Baltow, 76, told me.
This, of course, is nuts. Nevertheless, the returned-check fee levied by many banks is yet another example of how multibillion-dollar financial institutions don't hesitate to reach into customers' pockets for the most spurious of reasons.
"It's a crazy, crazy fee," said Linda Sherry, spokeswoman for the public advocacy group Consumer Action. "How could anybody know if there's money in someone else's account?"
Ever since the financial crisis, regulators have become more watchful about the types of fees banks can charge customers.
In 2009, the banking industry raked in more than $41 billion in account fees. By 2013, the latest year for which figures are available, fee revenue dropped to $32.5 billion, according to the Federal Deposit Insurance Corp.
But that doesn't mean banks have stopped turning the screws. It means that they're just as aggressive, if not more so, in shaking people down for fees they're still allowed to levy.
"They're not going to change until they're forced to," said Nancy Kim, a professor at California Western School of Law in San Diego. "They're not going to stop trying to make this money."
The industry isn't hard up for cash. In the most recent quarter,
And that's for just for the first three months of the year.
"They're not hurting," Kim said.
Baltow works part time as a bookkeeper for mechanics and parts suppliers involved with restoring classic cars.
He had no reason to suspect a client was having cash-flow issues when he deposited the client's check at an ATM. His client had never bounced a check before.
A few days after making the deposit, Baltow received a letter from BofA saying the check had bounced and that a $12 returned-check fee had been deducted from Baltow's account.
He immediately contacted the bank and was informed that he should have known better than to deposit a check drawn on an account with insufficient funds.
"I asked how I should have known that," Baltow told me. "They said I should have contacted the person myself."
Think of all the checks you've ever received, both personal and business-related. Imagine contacting the sender in each case to confirm that they have money in the bank.
Not only would this be time-consuming and impractical. It would be downright rude.
I passed along Baltow's experience to Betty Riess, a BofA spokeswoman. I asked why a fee would be charged to a customer who received a bad check. What could be the rationale for penalizing the check recipient?
Riess declined to comment, which doesn't signal much confidence in the legitimacy of this fee. She suggested I put the question to the American Bankers Assn.
Nessa Feddis, the trade association's senior vice president of consumer protection and payments, said banks face costs every time they deal with a bounced check. That money has to come from somewhere.
"The bank has no legal recourse to go after the person who wrote the bad check," Feddis said. "The customer who deposited the check is in the best position to recover the funds."
The bank could sue the check bouncer, but it would consider that to be a waste of time and resources.
So instead, it takes the path of least resistance and hits up its own customers — simply because it can. And if customers want their money back, as Feddis said, they can always go after whoever wrote the check in the first place.
Feddis said she didn't know the cost of returning a check, though it's almost certainly nowhere close to $12.
Katherine Porter, a UC Irvine School of Law professor who focuses on consumer issues, said the process for returning a bounced check is entirely automated.
As such, she said, the returned-check fee is similar to the $3 fee many banks charge for a non-account holder to use their ATMs.
"Does it really cost the bank $3 in this case?" Porter said. "Banks have a right to charge fees to cover their actual costs. But there's no way for anyone to know what the actual cost really is."
Feddis said that if a customer doesn't like a particular fee, he or she can always take their business elsewhere.
Easier said than done. Moving one's accounts and financial dealings can be a hassle — and the banks know this. Moreover, they don't make comparison shopping easy by plainly disclosing policies and fees.
"It's a question of how much competition is in the market," said Ross Levine, a professor of banking and finance at UC Berkeley's Haas School of Business. "Cellphone companies will work hard to help you switch providers. I don't think banks do that."
However, there's something many banks will do when you close an account.
They'll charge a fee.