Bofa No Longer To Resurrect Zombie Accounts

Bank of America is putting its so-called zombie accounts out of their misery. The lending company will no longer revive closed accounts when it gets electronic debits or credits relating to them; a practice that often generates unnecessary charges.

Zombie accounts stay deceased at BofA

All accounts that have been previously closed and are still sending electronic transactions for one reason or another at Bank of America will no longer be revived.

In May, a Consumers Union post pointed out the "zombie account" practice and said it should stop. It said that customers do not have the option to switch accounts when these kinds of things take place.

There are a ton of unexpected penalties and maintenance charges that show up and can add to hundreds of dollars when a deceased account is opened up. B of A will not be doing it anymore, but it and Chase were the only two large banks that still did it, according to Consumers Union.

Consumers the real issue

Betty Riess, a spokesperson for Bank of America, pointed out the problem can occur when customers are not sufficiently diligent when switching banks:

"As always, we remind customers to allow time for outstanding items to clear the account, and make changes to automatic payments and credits before closing the account."

About 20 percent of American customers decided they wanted to switch banks in the last year, but 63 percent of them said they were too concerned about switching electronic payments to do anything about it, according to Consumer Reports. This was what happened after Bank of America announced its fees for having a debit card.

Consumer Union pleased for now

Suzanne Martindale, staff attorney for Customers Union, applauded the move by Bank of America, but said it is the tip of the iceberg:

"While this is a welcomed change in policy, consumers at Bank of America and other banks continue to face a myriad of obstacles that can make switching to a new financial institution a time-consuming mess. That's why we need Congress and the Consumer Financial Protection Bureau to enact reforms that make it easier for consumers to move their money."

To be able to make it easier for customers to switch banks, the Consumer Financial Protection Bureau is considering brand new policies for banks. This could contain adoption of portable account numbers that can transfer between banks, prohibiting unfair fines and reducing check hold times.

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