ATM Users Scramble for Cash as Banks Battle City

ATM users were inconvenienced across Santa Monica Thursday as Bank of America and Wells Fargo blocked non-customers from using their 33 machines in the city. It was a new tactic in the battle over the city’s ordinance banning certain surcharges at automated teller machines.

Dan Kerman of Van Nuys, spending Thursday afternoon with his young son near Third Street Promenade, was surprised when a Wells Fargo ATM spat his California Federal Bank card back. Confused, he went across the street to a BofA machine and again failed to get cash.

“You’re used to traveling around with just a buck or two, because you know anywhere in Santa Monica if you have plastic, you’re OK,” Kerman said. “Now I’m getting nervous.” Kerman finally got his money at nearby Santa Monica Bank--without paying a surcharge.

BofA and Wells Fargo reprogrammed their ATMs in Santa Monica to reject all non-account holders’ bank cards in retaliation against the city’s controversial new law. “No business should be expected to provide free service to non-customers,” Gene Taylor, president of Bank of America’s western region, said in announcing the policy Wednesday.

The banks and the California Bankers Assn. are challenging the law in federal court, arguing that banking regulations fall under the purview of the federal government, and that municipalities have no say. San Francisco, where a voter-approved ordinance banning the fees is to take effect next month, is also a defendant.

The city of Santa Monica said it would await the court ruling before trying to enforce the law, but other banks appeared to be complying Thursday, the effective date of the ordinance.

Jon Gollinger, of the California Public Interest Research Group, said his organization and other consumer groups have urged the state attorney general to support the cities in the court battle. “The bank’s move isn’t just challenging the city’s right to make such a law, but the state’s right as well,” he said. “Like any bully, they’re trying to pick on the little guy to make sure no one will stand up to [them] in the future.”

ATM users in Santa Monica had mixed feelings about the furor. “I always bank here,” said BofA customer Joe Andreas. “I don’t want to pay the fees, but I believe banks have every right to charge them.”

“I think that people all over are looking for whatever’s most convenient,” said Teresa Hazin of West Los Angeles.