Is it discrimination to cancel a customer’s checking account for their bad credit? ING Direct has done so to Nick, who emailed me (and Consumerist) a complaint forwarded to the ING Direct ombudsman. ING Direct has closed his Electric Orange account, a checking account that earns a minimum of 4.0% APY currently.
Evidently, ING Direct performs periodic account reviews and will close accounts from customers who may abuse their overdraft protection based on credit reports. Nick admitted he had been “living in” the $1,000 overdraft protection (more like a cash advance). That could have triggered the account review.
I must express that I am heartbroken!! Yes, I have credit that is less than desirable, but I do not feel that is a basis for your discriminatory actions. Your decision has left me heartbroken, and also feeling foolish for all the recommendations that I’ve made to people for ING Direct…
Also of note, I have received two letters from your company regarding making more than “six transfers” from my savings. After the first letter, I carefully planned my transactions in such a way that I would use 2-3 transactions on each of my savings accounts, after which point they would be used for deposit only. ING Direct does not to tell people that they count transfers among ALL the savings accounts for a customer number toward the six each month.
As someone who received a similar six-transfer-maximum letter, I am sure Nick is misinformed on this point. The limit is six per account, not per SSN, as confimed by an ING Direct customer service representative. Nick probably received a second letter after changing the withdrawals because these letters are delayed by at least a month.
But this issue is unrelated to the closing of the checking account. Was this done fairly? Continue reading for ING Direct’s initial notice and Nick’s full response.
This letter was sent from ING Direct to Nick.
Dear Nicholas,
Customer Number: XXXXXXXXXXBased on your credit score, which was provided by a consumer-reporting agency, we have decided to close your account. We have reduced your Overdraft Line of Credit to zero ($0). We feel this action is in your best interest as well as ours.
Because we want to make sure you have time to manage the transition of your account, we will leave the deposit portion of your account open for the next 30 days. Please use that time to:
- Change any direct deposits you currently have scheduled for your Electric Orange.
- Update any bill payments that are currently set up for your Electric Orange.
- Repay any outstanding balance you might have on the Overdraft Line of Credit.
- Allow any pending transactions to clear.
After 30 days, you will not be able to use your Electric Orange – it will be restricted from all account activity. This means you will not be able to transfer funds in to or out of your Electric Orange or use your MasterCard® debit card.
Any account balance plus any interest earned on your Electric Orange will be transferred back to your external, linked checking account five business days later. However, if we know of transactions that have not cleared within those five days, we will wait to transfer funds until those transactions have been processed.
Please keep in mind, that while information from a consumer-reporting agency in whole or in part influenced our decision, the reporting agency did not make this decision and cannot provide information about it. However, if you have any specific questions regarding your credit report, you can contact that agency directly using the following information:
Equifax
Consumer Services
Atlanta, GA 30374-0241
1-800-685-1111
www.equifax.comUnder section 612 of the Fair Credit Reporting Act, you have a right to obtain a free copy of your credit information on file at the agency, if your request is made within 60 days of receiving this notice. Under Section 611 of the Act, you also have the right to dispute the accuracy or completeness of any information contained in that report.
Please note this does not affect any other accounts you may have with ING DIRECT. In addition, you are welcome to re-apply for another Electric Orange again in 30 days. If you have any questions, you can give us a call at 1-888-464-0727 from 8 AM to 8 PM any day of the week.
Thank you.
Here is Nick’s full response. Is it warranted?
When I first opened my ING Account, the rates, services and products were unlike anything I’d encountered in the banking world! The ING Direct website is fantastic, easy-to-use and VERY helpful. If one calls your call center, the representatives are always helpful, enthusiastic, and definitely one of the better customer service experiences out there. You deserve a great kudos
for that!However, I have enclosed an email that I received yesterday, and I must express that I am heartbroken!! Yes, I have credit that is less than desirable, but I do not feel that is a basis for your discriminatory actions. Your decision has left me heartbroken, and also feeling foolish for all the reccomendations that I’ve made to people for ING Direct. You can bet that has ceased, and will be replaced with a stern warning for anyone considering opening any kind of account with your company. I have also re-advised people to whom I have reccommended ING Direct to in the past, as I wish no one to have to go through this terrible situation. I’ve also advised several finance ‘blogs as to ING Direct’s new practices, as they have spoken very highly of your company in the past.
Also of note, I have recieved two letters from your company regarding making more than “six transfers” from my savings. After the first letter, I carefully planned my transactions in such a way that I would use 2-3 transactions on each of my savings accounts, after which point they would be used for depost only. ING Direct does not to tell people that they count transfers among ALL the savings accounts for a customer number toward the six each month. This practice is misleading, and should be clarified in future letters sent out.
I have closed out my CD’s, and all but two accounts. I will eventually be closing all of my accounts, and using only my local Credit Union.
Thank you for your time, and I wish you the best of luck in the future.
I still hold a good portion of my cash at ING Direct, though in a few months I plan on simplifying my finances and reducing the number of banks I do business with.
Although a part of me (the customer side) feels for this guy, another part (the PF guy side) understands and even admires ING for doing this.
Does it suck that someone could lose a deposit account based on credit? You betcha! On the other hand, for those without credit issues, doesn’t it suck a little bit that the interest rates for all are decreased just a little bit to help pay for the problems that may come up for ING later? Again, you betcha.
“We fire our customers is a colorful way of putting it,” said ING Direct’s Kuhlmann. “While the banking business says the customer is always right, we’re online guys and you can only do business with us in a certain way.”
Are we getting the whole story here? What do you mean by abusing an overdraft checking account? Was he over drafting frequently, or was this simply a matter of a random credit check and they canceled the account due to his score?
Please elaborate on what “Nick admitted he had been ‘living in’ the $1,000 overdraft protection” means!
The six withdrawal rule is well established for savings accounts, whether online or not.
If Nick happens to stop by, perhaps he can elaborate what “living in $1,000 overdraft protection” means, specifically. Bank accounts are not meant to be lines of credit, but if ING Direct offers the service, can they penalize someone for using it?
My impression is that a consistent negative balance in a bank account is reason enough to do an account review—or even to just cancel the account and use “account review” as an excuse. Negative balances are good for no one.
I had used the overdraft protection off and on, but how it is presented makes it almost like they ENCOURAGE you to use it. You can take cash from it, debit/credit use at a store, etc.
BUT, that is not the reason they cited! That’s my concern here. That is the question here… Also, why wouldn’t they run this BEFORE opening the account? Why am I being invited to open an account again in 30 days?
Also, my boyfriend is experiencing a situation like this, although ING is holding his new debit card hostage for some reason. His account was just opened, and they really tried to upsell him on the Electric Orange… He opened one, and now they won’t send a card, or say much about it.
quote:
“Bank accounts are not meant to be lines of credit, but if ING Direct offers the service, can they penalize someone for using it?”
Thank you.
Sorry…I’m still a bit confused. You were regularly $1,000 over drafted?
Over draft protection is pretty common. My bank pushes it also, though the charge a $10 fee for each overdraft. It’s much better than $35 for an overdraft. But despite that my bank offers me this service, it says in my member agreement (the multi-page brochure of fine print) that excessive overdraft activity can lead to review and suspension. I am certain ING would have a similar term.
I have ING, but not their checking, so I couldn’t verify this myself. Regardless, living in $1,000 of regular overdrafts is certainly excessive!
I will say this, I have a ING Direct account, and while I didn’t read all of the fine print, I did review some of it. I did not read where there was any credit review when I opened my account. However, I noticed a ping on my credit report.
Personally, I don’t think it’s right for them to require overdraft protection and then pull the whole account because they all of a sudden decide they don’t like you.
Yeah… erm… I totally need a financial advisor… that takes checks. :)
No, my account was not overdrafted 1,000 regularly. Except for the last week, I would carry a positive balance a lot of the time, and shortly before payday I would sometimes use my “line of credit*.” ING presents this like a line of credit. I would use their credit, and pay them for that privelege.
*From their website: “If you need to use your line of credit, there is no fee; you will just pay a variable competitive interest rate of 12.25% on the amount you need.”
If I were ING, I wouldn’t credit Nicholas either. That’s what credit reports are for, to measure the risk level of every borrower.
We enjoy those high APYs because ING can take less risk by filtering out the (potentially) risky customers. Way to go, ING!
The problem with a checking account is that it cannot come without any overdraft protection, AFAIK. So the bank did the right and logical thing.
Flexo or Nick – I can understand revoking the overdraft facility based on credit score. After all overdraft protection is an emergency loan – and every loan must take into account the risk of non-repayment. Credit score is a good indicator of such a risk. So yes, when it comes to “We have reduced your Overdraft Line of Credit to zero” based on credit score…I do believe ING has acted in the best interest of both the involved parties.
However, closing down his checking account is not fair. If there is no overdraft facility, then I fail to see how he can be a liability on the bank. However, this is explained by ING’s terms, which specifically state that:
That’s stupid of ING (in my opinion), but that’s how it is – I am not sure if other banks that offer overdraft have a similar condition.
Flexo: “but if ING Direct offers the service, can they penalize someone for using it?” – The letter does not say anywhere that Nick is being penalized for using his overdraft protection facility; the letter clearly says that it’s “Based on your credit score” – which I think, is OK. But again, it’s fair only as far as closing the overdraft facility is concerned – not fair for closing a checking account.
I see the frustration, but Overdraft Protection is, as it’s name implies, a pad to protect you just in case.
Their literature does encourage that customers use it, so maybe both sides need to re-examine their expectations of use.
Ing is more than a little twitchy about customers. I’m not sure where I stand on this one (I would think revoking overdraft protection would be the solution but I’m not a banker) However I have my own issue with Ing My husband signed up for an Ing account. (I referred him). Ing called him up to verify something before opening the account, and was very rude to him. He wasn’t in his most patient mood so he balked a bit and then said “never mind I don’t need the account.” Now if he tries to get an account they will not open one for him. Our credit is good – but because he wasn’t friendly on a call they have blacklisted him. We called up the chain attempted to apologize, but apparently once someone is on the ‘no add’ list they are never removed.
I had read that ING gets rid of customers who are less profitable to them. They want to keep the great 80% of customers and get rid of the 20% of customers that they consider difficult. The theory is that this is what allows them offer such a great rate.
I fail to see how Nick is a problem customer here. The only thing that I can think of is that the credit risk of Nick is greater than the 12% they are getting from the the protection. In this case ING should probably raise the overdraft rates. However, then all the customers with good credit would complain.
Reading this I wonder whether overdraught protection is aimed at protecting the customer, or at generating more income for banks. The interest rates wielded by banks for cash advances seem very high to me: 12% to 19.9% (I gathered these figures from the internet, so they may not be entirely accurate). Some banks couple these protection fees with the practice of first deducting these fees from the accounts of customers and only then paying the overdraft bills, a practice which leads to more overdraft and more penalty fees, i.e. more income for these banks.
Doing some online googling on this subject I stumbled across an interesting article about overdraught protection, by Annys Shin, with a summary of a recent study by the Centre for Responsible Lending (link included). Ca. 16% of borrowers – the so called repeat borrowers – pay 75% of all overdraft loan fees (7.3 billion of 10.3 billion). Compared to non-repeat borrowers, repeat borrowers less often own their own house, and more often are single and non-white.
If you want to know more, check out this article.
This happened to me, as well, although I’ve never, EVER been overdrawn on my ING EO account (and the checking account it is linked to hasn’t been overdrawn in over a year)! The letter I received this morning was identical to Nick’s…
My transfers were also quite limited.
I am/was absolutely astounded!!
Interestingly enough, the ING Direct website says:
CREDIT REPORTS – You agree that in connection with your application for EO and the OLOC, the Bank reserves the right to obtain credit information about you from one or more credit reporting agencies. You also agree that the Bank reserves the right to obtain follow-up credit reports on you in connection with the maintenance, review or collection of your EO and/or OLOC.
It wasn’t more than 4-5 weeks ago that I received my ING Direct savings account email statement with a link to info about the Electric Orange account. At that point, the FAQ CLEARLY STATED that no credit check would be performed for these accounts.
In fact, there was a question asking if opening an account could possibly reduce a credit score due to an inquiry. The answer was that no check would be performed.
It seems to me that there would be a cause for legal action if this statement was violated.
I’m assuming that ING Direct recently changed their policy on this issue. Does anyone perhaps have a print-out or PDF of their previous FAQ?
Apparently there HAS been a change of ING Direct’s policy. See this about.com page that also refers to the NO CREDIT CHECK policy:
http://banking.about.com/od/checkingaccounts/p/ingchecking.htm
Nevermind… I found the orgininal TOS and it says they may…
Three cheers for ING! I love a bank that will filter out the deadbeats for the benefit of the responsible customers.
@Nick:
What’s the difference if I write Anon or BSUserName? It’s still the same, as long as I don’t link to a personal web page. Posting anonymously does not invalidate my point. I honestly think you have the wrong attitude here (the “I am ergo I deserve” type). You should grow up and stop whining when a bank treats you as you probably deserve. Credit scores were invented exactly for that reason.
The bank has every right to choose its customers. I think they were pretty gracious by giving you 30 days for your incoming transfers. A brick and mortar big bank would have probably closed the account immediately.
Compared to the risk of a subprime borrower, a 12% APR is nothing. Plus, by using your checking account as if it were a credit line, you demonstrated that you were an irresponsible customer, probably the same image your credit history projects. The overdraft protection is there for rare accidental use, not regular one. You tried to profit of the fact that ING does not have an overdraft fee, and that they have a very nice overdraft APR, and you got burned.
I applaud ING for getting rid of the risky customers. Just as not everybody deserves to be insured by Amica, by doing this “spring cleanup”, ING can continue to offer their great service to deserving customers.
My Electronic Checking got closed too.
Before I get into why it was closed. There are a few people who seem to not understand how this account works. “Electronic Orange” is a paperless checking account. If there are no funds or not enough funds the transaction gets rejected. The online bill pay works that way too. Not enough funds, payment doesn’t get sent.
I would think it is almost impossible to abuse this account.
I called ING and asked if they can reconsider. They politely said “No”. They considered me a risk because there is Overdraft protection. I had $200 worth of overdraft protection. I guess they were worried I might take the $200.00 and run off to Mexico. I actually DON’T need OD protection. All I care about is having an account. My credit score is 50 points higher than when they initially offered me the account 7 months ago.
I question the way my closing was handled.
I am not upset with my OD protection pulled. I think as with any lender they have the right to cancel or close your account with little or no notice.
I believe with a checking account they need to send a notice in writing via snail mail. And give an exact date when the account will be closed. All I received was a generic e-mail explaining it will happen within 30 days. These days with identity theft, fraud, and phishing, spam filters and whatever you never know if these e-mails are real when you receive it.
I ran 15 grand in and out of ING accounts the last 7 months. Hell if I am going to give them another dime. They used to be a very nice financial instituation that seperated itself from a branch bank. Now the branch banks and credit unions are outdoing ING. Bye Bye ING, good riddence.
To be honest, all of us would be better off (as would our communities) using credit unions anyway! My local credit union offers interest rates only slightly lower than ING Direct, no service fees, excellent customer service, a large free ATM network, and both online and in-person banking.
Find a good local credit union and stick with it. They will offer you credit even when banks won’t (i.e. when you actually NEED the money) and at much better terms—especially if you build a good record with them beforehand.
Also, many credit unions can offer debt counseling, loan consolidation, and other services that can increase your credit score.
In other words, they can help you get your credit scores to a point where the banks will be trying to solicit your business. Once you have used a good credit union, though, you probably will not WANT to use a big bank again. (Then you can enjoy the satisfaction of telling the major banks where to go!)
Keep your money (and profits) in the local community where it belongs!
On my old terms It specifically says They will do no credit check, and they will not report this to any of the reporting agencies unless you default.
but on the other hand it says the terms are subjeck to change with little or no notice.
I mean subject to change.. sorry about the typo..
Does ING do a hard pull?
According to their FAQ, No. From the ING FAQ:
From Electronic Orange FAQ’s 2/17/07
Are you sure you don’t pull my credit to get the Overdraft Line of Credit?
Yes – positive. We do not check or ‘ding’ your credit. The standard $1,000 line does not even show up on your credit report, unless of course you don’t pay us back.
I’m not surprised with ING’s decision. I had a harrowing experience in the summer of 2001 that haunts me to this day. My husband and I married in June 2001. We had both had separate ING accounts. When we married, we decided to do a joint account. We called to find out what, if any, special procedures/limitations there would be. We were told there were none. We asked if there would be a way for us to simply “add” the other to one of the accounts, without there needing to be any sort of “hold” on the account and we were told that could be done, though they might put a maximum three day hold on the account. With this knowledge, we added me to his account.
More than a week later, we attempted to withdraw money for a down payment on a house, and couldn’t. And an automatic loan payment was rejected. When we inquired as to why this happened, we were told that there was a 10 BUSINESS day hold on our account. When we asked why, we were told because we had just opened the account. We explained that wasn’t correct, we had simply added me to the account, which should not have resulted in such a significant hold. We were transferred to a manager, who apologized for the mix-up, explained an incorrect code had been up on our account, and advised the account would be taken out of the “hold” status within two business days. We made alternative arrangements to cover the other issues.
After the passing of the second business day, we again attempted to withdraw the money for the down payment, only again to be told there was another 10 day hold on the account. I asked to speak to a manager (it was late, around midnight) and whomever I talked to said they were it. I explained we had just gone through this issue a few days earlier, that it was to have been resolved, and that this was a significant detriment to us, especially since it was a result of ING’s mistake (i.e., they put the wrong code on the account). The person with whom I spoke acknowledged this appeared to be the case, but said there was nothing they could do for me that night. I attempted to contact a manager the next day but my call was not returned during normal business hours (if memory serves me correctly). Anyway, the next day, I received a letter in the mail which indicated that my behavior was inappropriate and threatening, that I had been beligerent and demanding (I wasn’t, but I don’t think it would be unreasonable if I had been given the circumstances), and that, as such, they were cancelling our joint and individual accounts, and I was never welcomed to do business with them ever again since I’m such a “problem” for them. I was flabbergasted. I can’t put into words how I felt—I wanted to be belligerent at that point. We attempted to contact them to find out what prompted this “inappropriate” response but they refused to divulge any information, simply stating they can do what they want. My husband wanted us to just let it go, so I did.
Big mistake—in 2004, we separated, then divorced. He attempted to open an account with ING. Guess what—he couldn’t. Why? Because he “knows” me. That’s right. He had to get a letter, notarized, stating that he had nothing to do with me. Meanwhile, I have been receiving solicitations from ING Direct since the day we moved into our house in 2001. I get them in my new residence. I’m appalled that a company would take this type of approach with a customer, when the company was at fault.
But, given the way they treated me, I’m not surprised they would decide to cancel someone’s account because they were overdrawn or had bad credit. They certainly get an F in my book. If they continue to cause me problems indirectly, I will be forced to take recourse. My advice, don’t do business with a company you can’t see face to face. Sorry to Nick for his experience—but I agree with the poster who said that credit unions and local banks are the way to go….you won’t get as much interest but you will get personalized and, hopefully, courteous service.
“Three cheers for ING! I love a bank that will filter out the deadbeats for the benefit of the responsible customers”
Its already too late. From what I have been told ING has a problem. Tens of thousands of people have already maxed out overdraft protection. Most of these people have lines up to $1,000. I am not sure how much ING has already loaned out with OD protection. I would guess somewhere between 80 to 150 million. With all this money loaned out it would be harder to continue attractive rates for CD’s, and Savings accounts.
The overdraft protection is like an “Honor” system. There’s no due date. Just put money back into the account whenever. I think its a system that is bound for failure. Its human nature for a lot of people to spend beyond their means. Max it out again and again and again.
I think ING will need to have some sort of minimum payment plan. Maybe more restrictions. Like max it out.. but you have to pay at least half back or make the minimum payment for 3 or 4 months in order to use it again.
I encourage Nick and others with similar situations to place a complaint with the Better Business Bureau (or the more appropriate authority). If it is correct that his account was closed although he was in compliance with its terms, this seems unjustified. I also take issue with what appears as retaliatory action by ING against customers who bring bank errors to their attention (i.e., the poster whose account was closed after she attempted to rectify an account hold). I also encourage her to register a complaint.
I do not believe ING (or any other bank for that matter) should be allowed to close accounts that comply with their terms. In the short-run, there may be little or no remedies for these cases. In the long-run, placing a complaint establishes a record. As a result, this record may be used to hold the business accountable for its actions down-the-line.
I appreciate the benefit of my ING account but not at the detriment of others treated unfairly. Yes, I care. I will not get on my soap box about the government’s responsibility to ensure equal access to high-yielding savings, particularly for those with the least wealth and subsequently more likely to have less than stellar credit.
I also have a credit union account, which some posters have recommended. Unfortunately, their savings rates are not the best. For example, a money market account with my CU offers the best rate on savings without term requirements, about 1% APY. The rate on a regular savings account is about half of this. However, money market accounts requires a minimum balance of $10,000. On the positive-side, the interest rate on the car loan from my CU was extremely competitive.
According to the terms of the account. ING may close the account at anytime for any reason.
12. CLOSING YOUR ACCOUNT – We may, subject to applicable law, close your Account at any time, regardless of whether you’re in default. If your Account is closed by us or you, you agree to pay us all amounts you owe under the terms of the OLOC Agreement. If you’re in default, we may close your Account and require you to pay us immediately the entire amount you owe under the OLOC Agreement, in full. If we do this, we may also require you to pay us immediately the entire amount you owe under other loans or accounts you may have with us, in accordance with applicable law and subject to any contrary agreement we may have with you. You may ask us to close your Account at any time, by calling us or using our website. You also agree to stop using the Account immediately after you notify us in writing that you want us to close your Account.
I agree that Nick’s OD line should be discontinued at ING’s discretion, but to close a CHECKING account? That ’s ludicrous. How does a checking account with 0 balance and a 0 credit line adversely affect ING?
More than that though… Tee’s story is amazing. That kind of service and treatment for trying to resolve a series of mistakes made on ING’s end?? THAT is scary. It sounds as though once you have an issue with ING, they will mark you as a “problem” customer and jettison you ASAP. Worse yet, banned because of an affiliation of a blacklisted member????
All in all, this does NOT sound like a bank that works for ME; that wants ME as a customer. And you know, it would be one thing if they had like a 7.0% APY account that no one else was doing, then OK… while their customer service would still be less than desirable (to put it mildly), it could well be because they could.
However, with ING’s current yield and balance requirements, and with SEVERAL online banks with higher interest rates (hello 6.0% FNBO!), and lower balance requirements and so forth than ING, ING really has some cojones to be treating people the way they do.
I for one am CERTAINLY NOT begging to be a customer of theirs.
Thank you!! A lot of the self-righteous, white, college-educated, privileged suburban scum that is so judgmental were making me feel bad, just a little… I may have a bad credit score compared to you, but I am working on making things better every day.
Bad credit is no indication of a bad person. We don’t deserve to have our checking accounts closed at a bank’s whim.
Don’t worry Nick.. My account was closed too. These people don’t realize it only takes ONE accident or Illness to ruin a credit score. Most medical insurance plans cover only 80%.
You can talk smart all you want but if you end up getting sick, and have to pay $40,000 out of a $200,000 hospital bill. I’m sure your credit score will suffer too.
It happened to me too. I only overdrew my account twice and only by the MOST $20 and I put the money back less than 5 days later. I don’t appreciate that they would do this. I am going to call them tomorrow and see why they in fact did this…if they don’t reconsider, I am closing all my accounts with ING.
>>A lot of the self-righteous, white, college-educated, privileged suburban scum
Please – spare us the victimology…
A company should be able to terminate a customer relationship for any reason, just as a customer has the right to do so.
Your best bet would be to keep all records of correspondence with this company and report them to the Better Business Bureau. Keep in mind that it’s all about your rights, however companies DO change their policies without notice, so either review it from time to time, or just take your business elsewhere. ING has competitors such as Emigrantdirect or even from Citibank, who are not only online accessible, but also brick and mortar.
I, too, got the letter today.
I think a little background info needs to be shared to understand how this could happen.
What has not mentioned in this thread..is the fact when you open the account..a overdraft line is established…without checking your credit at all. In retrospect..if this is not a recipe for diaster..I don’t know what is.
Hasppily..in my case..it was low and I will have no problem paying all of it back shortly. I can see how $1000 line would have been worse..if i had been granted that..and maxed it out (impossible) then yup..I would have a problem paying it back in the next thirty days.
Many of you don’t understand how this worked..I’ll share. This checking account has no “normal” checks. This overdraft protectionwas, in fact, a line of credit. There was no way you could overdraft a checking account with no normal checks…it worked a bit different. Not only could you use the line by having them mail checks for you..to pay whatever..they even provided you with a mastercard debit that accessed it as well. As I pointed out…they made it extremely easy to use the credit line with these..uhh..”features”.
I don’t expect this to be fair. In fact..the reason my score is so low is because Capital One decided that 7 years was not long enough punishment for my old unpaid credit card left over from the great credit disaster (and Home Depot layoff) of 1999..and promptly re-aged it. After four disputes with Equifax..much has changed (corrected) but little has improved scorewise. It also didn;t help that another two year debt was reaged as well to look current..since corrrected..but the damage is there..more than 150 pouints.
Fair? Nope. I don’t expect fairness.
I received the same email as Nick sometime last week, and I have to say I feel his disappointment. I thought ING was great. I have been banking with them for almost a year and never had a problem. Then they offered me this great checking account, and my first thought was, “damn, I have horrible credit, I will never be approved for this.” I ran into some credit card problems in college that I am still paying for. It was my own fault, poor little spoiled kid runs up thousands of dollars of debt.
I had been without a credit/debit card for almost 3 years, so imagine my surprise and joy at getting approved by ING. I was given a $250 line of credit and I recieved my mastercard in the mail. I was able to reserve hotel rooms, purchase plane tickets, and order items online again. I was careful to repay any overdrafts as soon as possible and all the while ING is encouraging the use of their overdraft line. Finally, after almost 6 months I thought everything was great, so set up direct deposit for my paychecks from work. That way, whenever I did overdraft it would be paid back in no more than two weeks.
And then I got the email. The very same week, in fact, that my boss sent in my direct deposit paywork to human resources. I fully understand that I am viewed as a liability, but these people gave me hope and made my life so much easier and then they take it all way. It makes no sense that they would not check our credit to begin with. I could have lived with that, but they had made me angry beyond belief. If my paychecks were to be deposited every two weeks I don’t see how it could even be a problem for them.
Well they have lost out, I was raving to all my friends about ING and now I have to go back and let them know not to make the same mistake I did. The real irony in all of this is, that, two days after they sent their email, I was approved for a mastercard with a line of credit. I wouldn’t even have accepted that card if I still had ING, I would much rather be dealing with debit card, but, alas, ING took that from me. It is my fault? Probably, but I still can’t help feeling that they screwed me over, and lost one really happy customer.
“A lot of the self-righteous, white, college-educated, privileged suburban scum”
-nick
Nick what does “white” and “college-educated” have to do with it? Nothing…your just a little upset that you took advantage of a safety net linked to your account too many times, right?
In a way I’m sorry that this happened, but then again in the real banking world ODP is there to help keep customers from writing bad checks. When a customer’s ODP gets hit too many times it shows that they are either A)not keeping up with their checking acct. balance or B)Spending and knowing that they are going to have ODP pay for the check to be paid.
Maybe when you get your next checking account you should should get it at an actual bank where you can go in and speak to someone face to face. You may just have to give up the benefits of online to have personal contact.
Hope things work out in the furture for you. (Oh I’m white and college educated)
Nick’s letter simply does not address the problem. ING closed the account b/c of credit history, which creditors and banks use to determine continued behavior. bad credit history coupled with current bad financial behavior (i.e. continued use of overdraft) implies continued bad financial behavior.
i’m troubled by the perception people have about overdraft. overdraft with over 12% and fees is not enticing nor encouraging.
remember, knowingly writing bad checks can be a felony (depending on the State and amount). if you are continually overdrafting a checking account, you are essentially continually writing bad checks. not a wise decision.
moreover, if you are continually in overdraft, there seems to be an underlying financial management problem—that is, you are spending more than you are making.
re: BBB. BBB is not an end all and are not a consumer advocate per se. they forward to the company your complaint, which the company may or may not reply. the co. is under no way required to respond to BBB. if you feel that something is truly afoul, then contact your state attorney general and or a lawyer.
As with all internet banking. The OD protection was suppose to be to help if you needed cash during the “Floating time”. I believe if you didn’t have direct deposit, when you transfer monely from your local branch bank account the floting time before the money became available was 2 business days. If you sent a check to be deposited by mail the funds will be put on hold for 4 business days. Probably a week to 10 days if you count the time it takes for USPS to deliver it.
The OD was suppose to be for that. The problem is ALL Electronic Orange accounts come with OD protection. They don’t offer an EO account without it.
I dropped all ING accounts and decided to go with HSBC. They seem to have good online checking and savings accounts like ING.
Here’s why I picked HSBC.
1. If you deposit into savings funds are IMMEDIATELY available when posted to your account. (ING the wait is 10 business days)
2. You can get a debit card for the savings account. That way you don’t have to wait 2 or 3 business days for the money to be transfered back into your branch checking account. You can get immediate withdrawl from the debit card.(ING does not offer this except with EO)
3. Rates are much better. 5.05%.. ING is 4.5%
4. 24 hour telephone customer service. ING stopped 24 hour CS a few years ago. They started closing at 10 PM.. Now ING closes at 8 PM. I called HSBC after work at 2 AM and got someone to answer my questions.
I got approved for a checking account with them as well. I didn’t ask for OD protection. Don’t need it don’t care. But it has all the benefits as Electronic Orange and THE ABILITY TO WRITE PAPER CHECKS!!!
Minimum amount to start a savings or checking is $1.00. Sounds like a good deal to me. I’ll take that.
Any other good or bad things to say about HSBC? So far they look good..
2.
remember, knowingly writing bad checks can be a felony (depending on the State and amount). if you are continually overdrafting a checking account, you are essentially continually writing bad checks. not a wise decision.
Well said Tim :D
If you take advantage of something, it will be taken away. Not just ODP, but your whole checking account if you show bad personal financial management.
Gee Tim, thanks for the handy reminder.
It doesn’t apply here, unfortunately.
ING gives you a mastercard to access your funds; there ARE no paper checks.
Within the ING website, in the EO account, at the top, it shows balance, pending charges, available balance, AND OVERDRAFT protection, with a little equals sign showing your “TOTAL SPENDING POWER.” It INCLUDES the OD protection in your available spending power amount.
You people saying “good for ING,” and judging harshly on people who have negative marks on their credit reports, are heartless arses. As stated by another poster, one medical issue in your family can quickly become a credit nightmare. As well as people who are laidoff.
Not to mention you have a country that encourages irresponsible spending, and selling of debt to China. If you add this into a person’s parents not knowing how to manage money, and passing that onto their children, I hardly consider “cheering” on a corporate entity for coming down hard on people in general. In Nick’s case, I don’t offer much in the way of sympathy, but to bash him, and others’ in worse conditions is absolutely D I S G U S T I N G.
karma.
Unfortunately from the sound of it, even people who have decent credit scores and haven’t used the ODLOC are finding their accounts closed, so it’s not just “deadbeats” getting the shaft. They haven’t bothered me (yet), but being that I have less than a thousand dollars in accounts (no doubt I’m one of their “unprofitable scumbags”) I’m expecting my number is coming up soon.
I just got off the phone with ING Direct USA CEO Arkadi Kuhlman…he said the letters (5,300 of them) were “clearly a mistake,” that they “obviously were worded wrong,” and that ING Direct does not use credit scores as a reason to close accounts. I posted more information on my blog:
http://www.asklizweston.com/lizsBlog.html
So they were wrong in closing the accounts or was the excuse the wrong one?
I don’t buy ING’s statement.
here’s why:
1.) Shortly before my EO was closed, there WAS a soft hit from ING Direct which showed up on my credit report.
AR-ING DIRECT 04/12/07
2.) I contacted ING Direct. They told me the decision was solely based on my credit score.
If they worded an E-mail wrong, it should be good business common sense to send a corrected E-mail.
Obviously this company has lost touch with their customers. Time to get an account elsewhere.
I contacted ING Direct last week. They told me the closing of my EO account was solely based on my credit score.
Granted ING can open or close an account for any reason with or without notice, the bottom line is the 5,300 e-mails need to be corrected and resent.
And IF my account was closed by other reasons not stated in the e-mail, why did ING do a soft hit with Equifax shortly before the account was closed?
I don’t buy it. If I wrongly worded
e-mails to my clients. I would make sure another e-mail would be sent out ASAP.
sorry about the run on’s at the bottom. Looks like I accidently typed the same information twice. I need to send a corrected post.. LOL
ING Direct definitely does credit pulls, but Kuhlman said it’s to help determine the size of a customer’s overdraft line of credit.
As for whether the letters were in error, or if ING is merely backpedaling like mad, I dunno. But if your account was closed and you want it reopened, you can give it a shot now.
This is scary. I’ve had ING Direct’s Savings and Electric Orange both for a while. I did not receive this letter, but I’m still scared that I will. I have never used my overdraft line, nor do I have poor credit, but it’s not great either (660ish.)
It’s scary that they took this course of action. What I feel should have been done:
– Notify customers that have been using the overdraft that there will be a credit check – Notify ‘bad’ customers that their overdraft line is being removed and they need to pay back the balance within 30 days of notice (via SNAIL MAIL) – Allow these ‘bad’ customers to keep their accounts with $0 overdraft line
– If it’s true that these letters were a mistake, as someone above mentioned, they should immediately be sending out corrected letters
If this is the kind of customer service ING Direct is handing out, I’ll be switching to HSBC Direct soon. Too bad since I just got my work to begin direct deposit to ING Direct a month ago. I’ll hold out a month or two and see the aftermath of this.
I had been notified that my account was set to close due to bad credit (I was only extended $250 of overdraft and wasn’t using it excessively), but I just got an email stating my account would NOT be closed and the overdraft is already back!
Well now…I just received this email:
On behalf of my colleagues at ING DIRECT, I wish to sincerely apologize for the email you received regarding the closure of your Electric Orange. Your checking account will not be closed as indicated in the email correspondence. Also, your overdraft line of credit will be active within 48 hours. You are a valued Customer and we encourage you to continue to use this account. Again, I apologize for the inconvenience this mistake may have caused you.
If you have any questions, give us a call at
1-888-464-0727.
Jim Kelly
Chief Operating Officer
ING DIRECT
Sounds to me like they’re just trying to mitigate the damage done, after seeing the kind of fallout brewing. If you have any doubt about this, go back to the original text of this thread, and check out the wording of the original letters sent out. That was CLEARLY not an accident, or simply a matter of poor semantics. This was a deliberate action.
To the people who got these letters in the first place (and to ppl thinking about using ING): do you really want to give your money to this bank for safekeeping? Seems to me that ING’s #1 priority is: I N G, not the customer, as it should be.
I just received the same email – they closed it and now reopened it. I never requested OD protection, they provide it automatically, and I never abused it.
If enough people zeroed out their accounts or closed their accounts. It really can do damage on a bank. Most banks don’t have the cash on hand to cover mass withdrawls.
This is text from a banking FAQ..
“If all depositors were to withdraw just 10% of their deposits, the bank would have to close their doors!”
ING Direct and Electric Orange Account…. I don’t think any of the above understands the OverDraft Line of Credit on the Electric Orange Account. ING calls it “Spending Power”...your account balance plus your OverDraft Line. You are encouraged to use it. You do have a minimum payment and due date. You are charged 12% interest when you use your OverDraft Line of credit. ING says they do not check your credit to open the account…but, has the right to do so. They have the right to close an account for no reason.
I had an EO account with OD. I have never used my OD…nor planned to use it. It was a nice token from ING. My credit is good with 3 out of the 4 agencies. But, a little problem, on going, with Equifax caused ING to close my account like everyone elses. There email was rude…it too hurt my feelings. I liked the EO because it gave me fast access to my savings if I did ever need it….Like HSBC, BOA or my Wacohvia checking and savings. But, I emptied my EO checking into my savings and then closed my savings. I can save my money anywhere…like HSBC or even Capital One or any Money Market Account…Paypal even pays a good rate.
Now, today…ING sends an email saying my account closing was a mistake and my EO with my OD is restored. Why, this sudden change of heart from ING? Was it truly a mistake? Or do they really miss my automatic deposits every two weeks? And if I go back and reopen my savings and use my EO…what is to say that they will not do this again and again…..
Carl, I completely agree.
You spelled out how “overdraft” or OLOC works with ING, to the other rude commenters, and I appreciate it.
They are not aware the the OLOC amount is included in your “SPENDING POWER” by default. You can not have an EO account, WITHOUT automatic OLOC protection.
Secondly, I really thought I would like ING; the website is easy, the transactions have been smooth, and for once, aside from my 401k, I thought hey, I can actually save money and cash in on the higher interest rate.
Well, this email is a major mistake, whether intentional, or not. Eventually word gets around about sudden account closures, and then sudden reinstatements?
I know ING’s longstanding reputation; but questions about reliability and STABILITY are huge questions when it involves a person’s money. I never received the letter, my account was never closed, but I’m in the process of opening another account with a different bank.
And it sucks; but I have to look out for me.
I think what simplemind said rings true more than any of the other theories…they’re seeing gobs of money flowing out the door all at once and need to try to mitigate it somehow.
Me thinks the damage is already done to some degree, no matter how much backpedaling they attempt.
Liz: Thanks for stopping by to let us know about your conversation with the ING Direct CEO, Arkady Kuhlmann.
Whether or not ING Direct now supports the plan, the idea to eliminate a fair number of EO/OLOC customers was intentional. The letter was clear and the CSRs had the information as well.
No, the original plan is not fair to people who have bad credit through no fault of their own. Neither are mortgage applications or anything else that relies heavily on a credit score.
A better option for ING would have been to remove just the OLOC for those customers viewed as at risk for default. ING does mislead its customers by giving a total “spending power” calculation (above the normal account balance) that includes the OLOC, encouraging people to spend beyond what they have.
This flies in the face of the corporate money management philosophy for its customers that ING Direct has shown for years with its formerly weekly tips newsletter.
If I had received the original letter, I would have removed all my money from ING Direct. Even after receiving the apology letter, I would not have moved the funds back. There are many other options for online banking available, some of which pay higher interest than ING Direct.
I also recieved the same email that Nick did, however this evening I recieved another from ING’s COO that stated the following:
Customer Number: XXXXXXXXXX
On behalf of my colleagues at ING DIRECT, I wish to sincerely apologize for the email you received regarding the closure of your Electric Orange. Your checking account will not be closed as indicated in the email correspondence. Also, your overdraft line of credit will be active within 48 hours. You are a valued Customer and we encourage you to continue to use this account. Again, I apologize for the inconvenience this mistake may have caused you.
If you have any questions, give us a call at
1-888-464-0727.
Jim Kelly
Chief Operating Officer
ING DIRECT
——-
I also have less than desirable credit, however I was frustrated that ING made a poor business decision by not checking credit scores to begin with. When I called the CSR was overly apologetic as I explained that I just changed all of my direct deposits and withdrawels from my old bank to ING.
Now that I spent all of my time today changing them back to the old bank, I highly doubt that I will ever change them back to ING.
Take away my line of credit as you wish, but it’s a deposit account and I highly doubt any other customers would be affected by it being closed at any time.
Thank you, Nick. Without a response from customers like us, they would have been able to get away with this.
Not that this has any impact on anything, but they have officially changed their policy regarding credit checks to OPEN accounts. As currently posted on their EO FAQ page:
Do you pull my credit if I apply for Electric Orange and the Overdraft Line of Credit?
Yes. As part of your application, ING DIRECT will obtain information about you from a consumer credit reporting agency (a “hard pull�) to confirm that you are eligible for Electric Orange.
Seems like they are being pretty cut and dry with these account closures. When I called to discuss mine (and ask to keep the account with $0 OLOC as I have only used it once—when I changed jobs and was dealing with the change in payroll dates), the CSR said that even his account was closed. One of their own employees—it’s not like they don’t know exactly how much or when funds will be direct deposited! And he doesn’t even have bad credit—just not a lot of it (only student loans). I’m trying to decide exactly what to do with my money now that the account is reopened. Do I like it enough to stick around and deal? Maybe. I will be examining the HSBC account since everybody seems to speak so highly of it. I’ve been w/ ING for 3 yrs and up to this point have had nothing but raves for them, but this is just ridiculous. Get it right the first time (run credit checks), and don’t muck it up even worse when you realize you’ve made a mistake.
Oh, and Nick: I am white, college-educated, suburban, and admittedly fairly privileged (even though I can never remember how to spell privilege), yet hopefully not self-righteous or scum. Would my opinion count if I were to disagree with you?
I called to check on my EO account. It is still closed and will remain closed. I guess I didn’t make the cut.
All the e-mails for those who made the cut were sent out on Wednesday. If you didn’t yet receive an E-mail, your account will likely be closed.
Thought I would pass along the information not everbody’s account will be re-opened.
All of a sudden they are doing a hard pull? They are bastards. this is after they previously said…
Does ING do a hard pull? No
Are you sure you don’t pull my credit to get the Overdraft Line of Credit?
Yes – positive. We do not check or ‘ding’ your credit. The standard $1,000 line does not even show up on your credit report, unless of course you don’t pay us back.
Is there any way the people who received this letter could post their credit scores? I am curious where the cutoff was. As I posted above, my Equifax is 660, other scores are 670 and 680, and I did not receive the letter. Post anonymously.
“ING does mislead its customers by giving a total “spending powerâ€Â? calculation (above the normal account balance) that includes the OLOC, encouraging people to spend beyond what they have.”
I copied that quote from above. I will have to side with the people who feel this is misleading. While I agree that it is your responsibility to keep track of your account balance and know what you have, when you go to write a check, they do not list your account balance. The only thing they list is “Spending Power”
I’ll give you an idea what my score was. I got my ING account around 12/06. My credit score hit rock bottom. I had some emergency home repairs and car repairs hit all at once. I skipped payments on cars, and credit cards to fix the problems. I eventually got caught up.
Here is my credit score month to month sice I got Electric Orange.
478—12/06
506—1/07
513—2/07
527—3/07
524—4/07
570—5/07
So, I too received the email from Electric Orange where they notified me that they were closing my account. I love ING direct, and I was disappointed by this decision. I sent an email to ING firmly stating that I thought this was a bad decision and that I was a good ING customer. I have never used my overdraft credit line. My email was firm, but polite.
A couple of days later, ING for some reason reversed this decision and sent me the following e-mail:
“On behalf of my colleagues at ING DIRECT, I wish to sincerely apologize for the email you received regarding the closure of your Electric Orange. Your checking account will not be closed as indicated in the email correspondence. Also, your overdraft line of credit will be active within 48 hours. You are a valued Customer and we encourage you to continue to use this account. Again, I apologize for the inconvenience this mistake may have caused you.
If you have any questions, give us a call at
1-888-464-0727.
Jim Kelly
Chief Operating Officer
ING DIRECT”
As you can see, this was a great surprise to me. My credit score is abysmal as I filed for bankruptcy 6 months ago. I’m not quite sure why ING reversed its decision, but all I can say is that I’m happy that I get to keep my account.
Just got this email. Kiss up to customer time?
That’s right, from June 1, 2007 to July 31, 2007, when you use your Electric Orange MasterCard® Debit Card to make a signature-based purchase, you’ll get 1% Cash Back, up to $500, on what you spend, anywhere. It’s simple. Just use your Card for every-day purchases like, groceries, clothing, gas, or even to pay utility bills and insurance premiums. It all adds up to a Cash Back reward for you.
I had the same experience, but instead of replying in an email I chose to call. The reps must’ve already taken many calls to the same effect and they sounded harried and were verbally abusive. It is a line of credit with interest charged connected to a checking account. I only used it once and paid back three times the minimum amount (for a total of $300/month). I had just made my second payment when they closed the account BEFORE I received the email explaining what had happened. I found out at the gas station on my way to work when my card was declined. I immediately transferred the balance back into ING after I was threatened with being reported to the credit bureau if I did not pay ahead of schedule.
As soon as my payment cleared, I received the bulk email apologizing for the inconvenience. It neglected to apologize for the insults from the reps I spoke to and for the embarassment of having a card with hundreds of available “spending power” declined. I have never had a card declined in my life.
As a result, I am now attempting to close my account which is a lot harder to do as a customer than it is to do as the bank!
I have moved the money from my ING savings to EmigrantDirect and am getting 5.0% APY. I was a customer of ING’s since March of 2004, and referred to them many customers which I then came to regret. I am happy to add that explaining their whimsical see-saw approach to banking decisions to my business associates and community members that we have collectively withdrawn over $400,000! I don’t place my money in the hands of someone I don’t trust and the same holds true for the bank that holds my money.
Don’t trust ING!!!
I wish ING Direct would say what the mistake was. 5,300 mistakes is a lot of mistakes. I called ING today and verified that my EO/OLOC was infact open. They didn’t appologize over the phone for the mistake but, they did reopen my savings account, that I had closed, in two seconds flat. I like ING, after four years, I’ll give it another go. I like the EO because it is fast access to my savings and having the OLOC isn’t a bad thing though I trust I will never use it. I like saving my money. EO can not replace BoA checking with billpay. I even use Wocohvia as my local bank…since BoA doesn’t have a branch in my state.
My credit isn’t great but it isn’t horrible and improves monthly. Unless you have ever hit rock bottom like I had in the past you might not appreciate my collection of checking and saving accounts. Your world can turn on a dime too. I say this for the snobs of poor credit scores in the previous post. Try losing your job, because the company you worked 20 years for went under, be unemployed for two years, have your house burn down, your spouse die, burn through your life savings, become homeless for two years, lose 125lbs because of hunger….then not be able to get a job, when one is actually open that you are not under or over qualified for, because your credit score prevents you from being acceptable and you can’t open a checking account when you finially get a job for minimum wage (by begging) because of your credit score and have to pay 5-10% just to get your paycheck cashed. Don’t be a credit score snob…it isn’t becoming.
So ING made a mistake or a bad decision, whatever. I am human I have made a few myself. But, it seems they are trying to right the wrong. I’ll give ING another chance because they were among the first to give me another chance. But, I did give them several C’s and F’s on their report card….and perhaps before you run away from them, or not, you might also give them deserving grade for their “mistake” towards you. ING like all companies pride themselves on their Customer Service Scores. I just hope that one day I will feel the joy of the Orange again and be able to give them all A’s again.
I can’t forgive this mistake. Sorry.
I was on a business trip. I used my Overdraft Protection to pay for my expenses. My employer reimburses me and I usually pay the OD back within a few days.
Here is my story. Imagine being out of town, debit card stopped working, and no means to pay for ANYTHING?
I eventually had to use a Check Advance place.
Why should I NOT be upset?
When I contacted CS, it didn’t sound like a mistake. They were rude and the atitude was “too bad”.
I don’t care if my account is back up or not! ING can keep it. NEVER, NEVER, NEVER, NEVER again.