11/28/2012 - ''Ninety percent of Americans use checking accounts, but they are often unaware that agreements with their bank limit their legal options if there is a disagreement, a new report from an arm of the Pew Charitable Trusts finds.
The report studied 92 large financial institutions and found most (64 percent) limit consumer options for resolving complaints about checking accounts in some way, like through the use of “mandatory binding arbitration” clauses. The clauses require customers to submit complaints to an outside arbitrator — usually chosen by the bank — instead of to a court.
The bigger the bank, the report found, the more likely it is require arbitration or impose other restrictions. (The report says 43 percent of institutions use agreements with mandatory binding arbitration clauses, but that number rises to 47 percent when only banks are included, because none of the credit unions in the study use the clauses.)
'Consumers need to be educated about this,' said Cora Hume, project manager for Pew’s Safe Checking in the Electronic Age Project.''
Read the full article, How Banks Limit Your Options in a Dispute, on the New York Times website.