A Texas law firm is investigating Citigroup and other banks for taking out secret life insurance policies on current and former employees, and collecting the benefits when they die.

http://insurancenewsnet.com/article.asp?n=1&neID=20090113290.2_e8e10061f739577c

HOUSTON, Jan 13, 2009 (BUSINESS WIRE)-- Attorneys from Houston's The Clearman Law Firm ( www.clearmanlaw.com ) are announcing a nationwide investigation of banks that have purchased secret life insurance policies in order to collect benefits when current and former employees die.

Many of the world's largest banks have purchased "bank-owned life insurance" or "BOLI" for years, including Bank of America, JP Morgan Chase, Bear Stearns, Citigroup, Wachovia, Washington Mutual, Wells Fargo and many others.

"We are investigating banks that insure the lives of employees without their knowledge or consent, " says class-action attorney Scott Clearman of The Clearman Law Firm. "These types of policies benefit only the banks, not their employees."

In a BOLI program, a bank designates itself as the beneficiary of life insurance policies covering its employees. Nearly half of all U.S. banks have reported owning BOLI policies at an estimated value of $120 billion.

A bank purchasing a BOLI policy must provide the insurer with personal information belonging to each covered employee, including his or her name, sex, age and Social Security number. Employees' Social Security numbers are then used to conduct "death sweeps" where banks typically hire outside brokers to sweep public records in order to learn if an employee or former employee has died.

A person whose life a bank insured without consent may have a right to sue for the bank's misappropriation of their identity (name, sex, age and Social Security number). Employees may be able to recover profits made by the bank, broker and insurer.

"It is ironic that thousands of bank employees have been laid off, and yet the banks still stand to benefit financially when those employees die, " says Mr. Clearman.

Since the early 1990s, Mr. Clearman has been a pioneer in class-action lawsuits against employers for wrongfully insuring employees' lives for the employers' benefit. Following several individual lawsuits for the families of deceased employees, Mr. Clearman pursued landmark class-action claims against Wal-Mart and Fina that resulted in major settlements for his clients.

I have a checking account with this bank and sometimes have a small balance before my paycheck is automatically deposited. This week, I was charges an overdraft fee of $35.00 for a $6.38 check card transaction even though my balance was more than the transaction. Another check was coming through their system at the same time as the $6.38. Rather than pay the $6.38, they took the larger amount knowing full well that by doing this, both transactions would bounce. I contacted the bank via internet and the lady said that "they had found that their customers would prefer the larger items to clear first". This is absolute crap and not a policy. It is merely what "they have discovered". THIS BANK WILL RIP YOU OFF! DO NOT BANK WITH THEM! THEY ARE THE WORST BANK EVER!

I requested a st0p payment a few days ago thinking that it would be better for me have the check destroyed and stop the payment of the check just in case someone found the check and tried to order something online. I checked my account yesterday and found that I was charged $28 to stop payment on a check. If I would have known that there was going to be a fee, then I never would have proceeded. I did this online and I was never prompted that there would be any fee. However they informed me that in the little print (8.5 font) that it mentions that a fee could be charged. I'll be damned they were right. I tried to explain to their customer service department 3 different times, 3 different people and they all told me that the could reverse the stop payment, but they could not reverse the fee. Bank of America has the worst customer service that I have ever experienced with a bank. I guess if you want to be able to have banks all over the country, you have to pay for it by crappy customer service and fees that they don't tell you about until it's too late, or in my case they hide it in the smallest font possible and when you dispute it they just send you on your way. AHHH!!! I just needed to vent and share my experience. Needless to say, I will no longer bank with them.

The software application that is provided by Bank of America for downloading to cell phones that allows access to account balances, presents the account data in a manner that is misleading when compared to the same data available through their On-Line Banking function when viewed by computer. The misleading data generates a revenue stream from the overdraft charges it creates.

When contacted about the misleading information their Executive Customer Service representative rudely made it clear that Bank Of America does not accept information regarding the accuracy or functionality of their On-Line applications from their customers. He also rudely made it clear that Bank of America is in business for making a profit and that I should be using pencil and paper for tracking my account data instead of trusting the accuracy of their On-Line applications.

BE VERY CAREFUL - THEY HOLD YOUR FUNDS -We are a non-profit business. One of our checks came in and was returned. We still had a positive balance on our accounts. However, after 7 years and no warning, BOA froze ALL our accounts on December 23rd at 8pm. No warning, no nothing. Our money has been unable to be accessed for 8 days so far. Supposedly, "corporate has decided that we are a high risk customer" and is closing our accounts on December 31 (today) We are going to be mailed Cashier's checks from each account today - supposedly.

Our non-profit business serves the youth. I am not sure how to publicize this event but I want everyone who has an account with Bank of America to switch. They will pull your accounts at a moment's notice without telling you, no matter how long you have been with them or how much money you pass through them. We are small but still passed over $750, 000 through them this year. There is no one local to talk to. The branches are at the mercy of "Corporate" and can't help you. I have opened a new account at TD BankNorth and it is nice to talk to humans who actually know you and actually want your business. What was amazing to me is that they closed my wife's and mine personal accounts also!! They have frozen them since December 23rd despite having positive balances!! Fortunately we have other means of buying food, gas, etc. but had we not we would have had a terrible holiday season!

If you own a local business do not bank with Bank of America. They do not care about you and their local branches are completely powerless. Go with someone you can have a personal relationship with.