"Banks have added all sorts of fees on basic checking accounts which has raised alarm bells," said Suzanne Martindale, staff attorney for Consumers Union. "But when you hit breaking point and want to move your money, guess what you encounter: more fees."
Consumers Union said none of the 10 banks will make a free same-day electronic transfer, and all charge for wire transfers or certified checks. Certified checks can cost up to $10 and wire transfers $30.
BB&T (BBT) and Citibank charge a $25 fee if the account is closed within 90 days, while U.S. Bank, HSBC (HBC), and PNC Bank (PNC) charge customers a $25 fee to close an account that has been open for fewer than 180 days.
The survey was commissioned after the public furor over Bank of America's plan to start charging its customers $5 for using debit cards. Bank of America backed off after many organizations, including Consumers Union and Occupy Wall Street protesters, called on Americans to transfer accounts from large banks into smaller community banks.
A survey of customers at the top 10 banks by consulting firm cg42 in November found that one in five customers actively considered switching accounts.
However, Consumers Union soon started hearing from its members that that it wasn't easy to close accounts. Not only did it cost money, but it also cost a lot of time.
Opening a new account at another bank can take a few days or up to two weeks for all the paperwork to be completed.
Re-routing automatic payments and direct deposits into a new account can take four to six weeks and can be a very intimidating and complicated process for some consumers, the group said.
Banks sometimes reopen old accounts after they have been closed by customers.
Chase reopens an account if the bank receives a deposit. Consumers Union said that could easily happen if a direct deposit isn't re-routed in a timely manner. Bank of America's policy is to reopen accounts if any activity hits the account.
These can result in customers owing hundreds of dollars in penalty fees or even a monthly maintenance fee if a deposit falls below what is needed to avoid such a fee, according to Consumers Union.
Consumers are at risk of more penalty fees after they switch banks. If merchants and other billers charge for late payments for delays while re-routing automatic payments, the old bank may charge a fee for overdrafting an empty account or bouncing a check.
As part of the study, the group sent 16 secret shoppers into branches around the country to ask how to close an account and reviewed online fee schedules and account disclosures, tracked news developments, and collected consumer stories.