$35 NSF fee - who is responsible?

[msmerymac]

I bought a membership in an organization I volunteer for. The cost was $400. I decided to have them deduct $100 per month via paypal, until they reached $400 (so 4 months). I began this in June. 

I saw that they took money out in October, which I questioned, but then I thought that maybe I had signed up in June, but they actually took the money out in July, so I let it go. 

Then they took money out in November. I investigated and found that they had deducted a total of $600. They took a payment in June, but the first "auto payment" was in July. 

The money was in an account I don't use often, and when they attempted the transaction in November, it went negative and my bank charged me $35. 

I opened a complain ticket in paypal for the October and November transactions. A representative from the organization said they can't figure out how to refund the money via paypal, so they have contacted paypal and are working on it. 

My question is - who is responsible for the $35? I don't want to hit up the organization, because I want to maintain a good relationship, and it's not their fault the money wasn't there. I've contacted paypal about it, but I think they will claim it's not their responsibility. I've decided to wait and see what paypal says before contacting my bank, because I'm not sure my bank will see those transactions as "fraud" even though those two were sort of unauthorized. Do I just have to eat it?

[msmerymac]

Oh, they'll refund the $200. I just don't want to ask them for the $35, because this membership is part of a campaign in which they are trying to raise capital for a specific goal, so it would be taking away from their goals.

[halfpint]

My bank would refund the NSF fee - I'd start with them. Unless you have a history with a lot of overdrafts, I wouldn't think it would be an issue.

[v]

The answer -- always (well, unless you're a habitual over drafter) -- is to call your bank and ask them to waive it.

[ESF]

I'm going to try not to wade into legal advice territory here, but this isn't your fault, and I don't understand why you think you should be blamed for not being prepared for debits you didn't authorize hitting your account.

The Electronic Funds Transfer Act is probably one of the best pieces of legislation for bank customers on the books. Google that if you want more information, but I will say that very generally speaking, if a person complains to their bank and says that an ACH transaction was not authorized, the bank is typically required by federal law to investigate, and that investigation typically includes asking the originating bank to prove that the debit was authorized. If such authorization isn't provided in a specified time period, the bank is very likely obligated to reverse both the debit any fees associated with it.

If there is one area that banks are generally pro-consumer and where regulation works, it's dealing with fraudulent ACH transactions. The federal reserve will rain a parade of hurt down so fast if they have a poor record on this front. The fines are ridiculous, and banks can be shut down if they don't cooperate. Banks do not fuck around on this issue.


ETA -To clarify, if an unauthorized withdrawal was made from my bank account, I would not ask the bank to just do me a one time favor pretty please I won't ask again.  Because when I need the one time favor because of an actual mistake on my part, I won't have it. And if I was  dealing with someone that would not do me the favor, then I'd be screwed.   Complying with the law isn't a favor to be handed out on a discretionary basis, so if a law was broken, I'd start there.

[msmerymac]

I guess my only concern is that it seems like the paypal debit was set up to continue in perpetuity. I feel like that was a mistake on the part of the organization when they set it up (I signed up via paypal, but through their website) but I accidentally assumed I was signing up for a finite amount of payments. So it's POSSIBLE I did agree for them to continually debit my bank account even though the membership I'm buying clearly had a cost of $400. I'm kind of afraid paypal will nail me on a technicality (I haven't looked into it yet). I will investigate before calling my bank.

[madringal]

I would just call the bank and ask them to refund it. I refund fees as a "goodwill" to customers all the time. If they don't have a histroy of fee refunds I am happy to do it.

[Deleted]

If you exhaust all other avenues with your bank and PayPal, I would ask the organization to return the money. However, I assume this is a nonprofit organization, so you could always make a small donation to ease your conscience -- and it would be tax-deductible, at least.

[msmerymac]

Nov 10, 2014 13:18:51 GMT -5 @linzercookie said:

If you exhaust all other avenues with your bank and PayPal, I would ask the organization to return the money. However, I assume this is a nonprofit organization, so you could always make a small donation to ease your conscience -- and it would be tax-deductible, at least.

They are not non-profit.