Banks violate the automatic stay when they require you to pay past debts in order to open an account.
June 29, 2010 – Today Judge Isgur of the Southern District of Texas suggested that banks may be violating the automatic stay when they require payment of overdrafts or other debts in order to open an account. He stated that this is a frequent occurrence in his court that debtors are required to pay these balances. He did not make a definite ruling but invited the debtor in a case to file a stay violation lawsuit.
The thing to do is to tell the bank that they are violating the automatic stay, ask for a supervisor, and most importantly ask them to put it in writing then go to your bankruptcy attorney and file the lawsuit. If we as debtors’ counsels get more aggressive the banks will change their behavior. This case involved First Convenience Bank which I recommend clients to avoid because I think they are predatory when it comes to overdraft fees and authorize debit card purchases when there is no money in the account only to charge a $30 plus overdraft fee and let the consumer run up hundreds of dollars before they stop.
