Here's how it works. Let's say you have $100 in your checking account and you purchase the following items over the course of the day:
A pack of gum: $1
Two dildos (one for each ear): $15
Some gas: $10
The "Best Actor" Academy Award Steven Seagal won for Under Siege, bought from a street vendor named Handless Bob: $25
That still leaves you with $29. Hooray, you can manage your money!
"Oooo, just enough to buy the actual Steven Seagal."
Ah, but you forgot to note that you had a $100 phone bill due the next day. Well, shit, that means one of those transactions will put you in the red, costing you a $35 fee. That's what you get for losing track of due dates, right?
But you're not going to pay one fee. See, the bank doesn't have to process the charges in the order they came in. What they'll do instead is start with the $100 phone bill -- even though it came in after the other purchases. Why? Because that immediately brings your account down to zero. Then they can process those previous, smaller charges so that they can nail you with a $35 overdraft charge for every fucking one of them. Even that goddamn pack of gum sets you back the price of a tank of gas. Now your account is $175 in negative territory, and until you pay all of that back, every single purchase will cost you another $35 surcharge. This is when a bunch of Nigerian princes start lining up to ask your bank how they pulled that off without you stabbing them in the face.
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"They used to stab us with our pens. That's why we added chains."
If you're thinking that it's a clear scam, the government actually agrees with you. The Federal Deposit Insurance Corporation has been all over that shit in recent years, and their actions have caused about 40 percent of banks to drop this particular practice. What actions did they take, you ask? Why, the FDIC wrote the banks a letter and asked them to stop.