Bank Account Closed by Bank

[vjfagan]

My question involves personal finance in the State of: Texas

My bank closed my checking account. My husband called to complain about the additional fee for using another ATM because the bank's ATM was not working. He threatened to close the account if something wasn't done, the clerk hung up. We discovered two days later the account had been closed. We have outstanding checks and direct deposit in limbo. Can a bank legally do this?????

[flyingron]

No, work your way up the chain of command at the bank until you can get to the bottom of it.

[Mr. Knowitall]

What makes you think a bank can't close an account holder's account if he abuses a bank employee - and I expect that's a safe assessment of how the bank employee will describe the exchange.

Banks can and do terminate their relationships with customers over problems relating to those customers, including financial and behavioral issues.

[flyingron]

Without notice? While funds are still on deposit. NO WAY BULLWINKLE. Something is wrong here.

[Mr. Knowitall]

Boo Boo Bear, you still don't know that your instinctive sense of what's fair and the law are sometimes at odds? Here ya go.

Yes. Generally, national banks may close deposit accounts for any reason (e.g., inactivity or low usage) and without notice. Federal banking laws and regulation do not address the closing of deposit accounts.

This issue is governed by the Deposit Account Agreement you received when you opened your account. Review that Agreement, and contact your bank directly for more information.

[chyvan]

When this happens, run, don't walk to another bank. There is also a risk that they'll flag your account on ChexSystems with a "for cause" closing, and then you'll have the added inconvenience of trying to find a bank account at a bank that doesn't use ChexSystems or the branch employees are empowered to override a ChexSystems entry if you have a good story.