“Turns out overdraft fees are still big moneymakers for some banks. So much so that a former chief executive of a midsize bank named his boat after the fee.” – Washington Post
“Among the juicy details included in a new consumer advocacy lawsuit filed Thursday was this one: The former CEO of a Midwest bank actually named his boat … “Overdraft.” – Money
“U.S. oversight officials accused Minnesota-based TCF National Bank of tricking thousands of customers into accepting overdraft fees with such aggressiveness that the practice ended up as the name of the former CEO’s pleasure boat.” – USA Today
The Consumer Financial Protection Bureau, in a lawsuit against TCF Financial Corp., claims that the bank overcharged customers who overdrew their accounts.
It’s a good story about how the bank allegedly misled account holders about how much it charged to cover the overdrafts, and pressured them to buy overdraft protection after the Federal Reserve Board amended its regulations to require that customers “opt in” for coverage. Otherwise, banks couldn’t charge overdraft fees.
It’s always interesting to read about banks that might have cheated their customers. It’s especially so in Arizona, Colorado, Indiana, Illinois, Michigan, Minnesota, South Dakota and Wisconsin, where TCF has branches and where many aggrieved bank customers might want to get some of their money back before they switch banks.
The lawsuit says TCF’s overdraft fees totaled $180 million a year. You don’t need gimmicks to make the story interesting.
But a couple of throwaway lines in the lawsuit inspired efforts to dumb down the story. “TCF’s CEO at the time the Opt-In Rule went into effect was particularly attuned to how important overdraft fees are to TCF’s success. He even named his boat the Overdraft.”
We don’t know why the CEO did that and no one seems to have asked him. But that didn’t stop the Post, Money, USA Today and many others from putting that boat in their leads. It wasn’t even “clever” – they just parroted the lawsuit, without elaboration. The Post never bothered to come back to the boat later in the story so readers might have a fighting chance to know whether it was relevant.
“Wait,” I hear you cry. “If it’s stoopid, why carry it further?” Exactly. Tossing in the line about the boat isn’t worth the extra effort to explain the circumstances. Editors should have kicked back the stories and told the writers to get serious.
Marketwatch (which did resist leading with the boat) quoted a TCF spokesman: “The name of a boat is simply irrelevant to this matter.” The spokesman was right, which is something of an upset.
And what’s up with the picture of a boat that ran with the Money story? Is it the boat?
Where was it taken? When? If it’s the CEO’s boat, wouldn’t it have been nice to have shown “Overdraft” painted on the stern? Or wasn’t it there? As much of a distraction as it is, readers are owed an explanation.
Phillip Blanchard is a former business editor at the Washington Post. Previously he worked at the Chicago Sun-Times and newspapers in upstate New York. He is founder of Testy Copy Editors.
