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Issues With CD Early Withdrawal Penalty At Fort Knox Federal Credit Union

Saturday, November 26, 2011 - 8:46 AMFort Knox Federal Credit Union - Details
The reader mak1118 provided the following comment in regards to Fort Knox Federal Credit Union and its CD early withdrawal penalty:
I called and asked a rep at fort knox if I close my cd early will I get all my interest whether it had been compounded yet and she told me I would get all my interest I would only lose 6 months of interest from the date I closed it. I closed the cd and they did not give me october and november interest when I wrote them back they told me the rep was incorrect.

I was the one that first reported on them raising their ewp and I remember the confusion, lou and the fort knox fan was telling me they had called fort knox and I was wrong they even talked to supervisors and they were wrong also, my point is what is a person to do when you call and they give you the wrong information, that cost me 600.00 and I did everything I could to prevent exactly this from happening, I feel cheated and taken advantage of.

When I first talked to Linda from fort knox when they raised the ewp she told me I was gaming the system, I told her that I opened the cd and accepted the ewp terms and then fort knox changed them retroactively, I told her sounds more like fort knox is gaming the system.

I think you should alert the other readers to the unfair practices at fort knox so they don't make the same mistake I did, trust the reps. Fort Knox credit union is not a place you can trust. They stole 600.00 from me, I would rather give that to somebody that needs it then those bunch of thieves at fort knox credit union.

14
Ken TuminKen Tumin5,468 posts since
Nov 29, 2009
Rep Points: 125,029
1. Saturday, November 26, 2011 - 6:56 PM
Mak1118,

I remember calling them and being told that EWP wasn't retroactively applied. Yeah, their customer reps. are uninformed, and it is extremely unfortunate they were allowed to get away with this. I truly thought at the time that no bank or credit union would ever resort to such practices. I guess I was wrong. I hope none of the readers of this site will ever do business with them in the future.

As regards the issue of losing accrued interest which hasn't been posted to your account, is there any lanuage in their written literature disclosing it. Have you looked? I wouldn't be too upset if it was already disclosed in their truth in savings agreements.
6
loulou541 posts since
Aug 3, 2010
Rep Points: 3,388
2. Sunday, November 27, 2011 - 10:53 AM
Lou I remember you,I did a rollover from my IRA into Fort Knox so I could not roll my money back out for another year without it being considered a taxable event, but as soon as the year was up that is when I called to make sure what I wanted to do would not cost me that interest but I was given the wrong information and now it cost me. I believe businesses should stand behind what their employees say and do, don't you? I never planned on keeping the cd the 5 years and only opened it because it was 90 day EWP, I could have gotten higher rates when I opened this but the EWP is what made me choose Fort Knox, imagine my surprise.
3
MakMak12 posts since
Mar 29, 2011
Rep Points: 298
3. Sunday, November 27, 2011 - 11:23 AM
What you describe unfortunately is far too widespread a problem, and not just with banks. Seems to be with ALL customer service everywhere. I have been burned by that too many times, even when I go to unbelievably extreme efforts to avoid being burned by it. That is something that REALLY needs to be cracked down on by law -- but it won't be. The banks and CUs need to be held liable for it, and need to be held to provide what you were promised verbally. Hey, they normally record those phone calls, so there is a record, so its not just your uncorroborated assertion.

For future reference, at least with a bank or credit union, there are disclosures you can read. So, double check such customer service statements by looking it up -- yes, through the miles of small print. (While closing a CD in midterm is perfectly legitimate, it nonetheless is an extraordinary action, so you better read the fine print.) Also, call about three times and ask three different customer service agents -- that's what I do, although even that doesn't always work; sometimes they all tell you the wrong thing, even the supervisors (I have even had the worst problems of this coming after escalating to the president's office at Citibank! There is no one, absolutely no one anywhere at Citibank who will give you the right info, not even the president's office!).

I have found it a not uncommon practice that banks will not give you interest that has not already been posted when you close an account. This is bad enough with monthly posting, but ever worse when they post only quarterly, and worse still for those that post all interest at the end of the CD term. The first I ran into doing that was Hudson City Bank in New Jersey, but I have found a number of others also do it. So, that issue is not unique to Fort Knox. I note, banks will simply do it, and many or even most people won't even realize they lost interest through the closing date. For those places, you need to time your closing with the posting of interest.

I wish this misinformation from customer service agents could be cracked down on. About all I can suggest is to file a complaint with the regulating agency -- heavily focusing on the point that it is what the customer service agent told you, as Fort Knox certainly will defend by pointing to the disclosures saying that is how it works. And sometimes, disclosures will actually specify that nothing you are told by an employee can be relied upon, that only the written disclosures are binding!
3
me1004me1004370 posts since
Jan 16, 2010
Rep Points: 2,567
4. Sunday, November 27, 2011 - 12:13 PM
I agree with everthing said here, but since we are venting, let me suggest the one-rollover-per-year rule by the IRS is an idiotic rule that makes it a pain in the neck to purchase CDs with IRA funds. I can't think of any good reasons for this stupid rule other than making it extremely difficult to move your IRA funds to get the best returns for your money. Unfortunately, the rollover rules are very arcane and the penalties for violating them are severe. If you allow the bank or credit union to move the money, it usually takes way too long before it arrives at the destination bank, so generally the only way to purchase a CD from another institution is to use the 60 day rollover. The IRS needs to simplify the rules and the penalties in this area. Why are they making it so difficult for savers to move their money?
1
loulou541 posts since
Aug 3, 2010
Rep Points: 3,388
5. Sunday, November 27, 2011 - 12:44 PM
I told the manager at Fort Knox to check the phone records but I know they won't. I will post on their facebook page what happens and then I will also bet that all the members that think they are a credit union out for their members will feel differently when they find out that all their 5 year cds that they probably think have a 90 day ewp is now 180 day ewp. I was told by someone from Merryl Lynch that this was a trial to see if Fort Knox could get away with this so others could also. Their facebook page is fort knox federal credit union if any of you are interested.
2
MakMak12 posts since
Mar 29, 2011
Rep Points: 298
6. Sunday, November 27, 2011 - 2:02 PM
I knew that poster yesterday that kept changing his or her name yesterday was an employee at Fort Knox why else would somebody not be able to see the deceptive practices, what a joke people only look through their eyes not through others. I always try to put myself in the other person's shoes to see what they see, try it some time fort knox employee it might open your closed mind.
4
MakMak12 posts since
Mar 29, 2011
Rep Points: 298
7. Tuesday, November 29, 2011 - 3:43 PM
I reported a problem with Fort Knox credit union last week about a mistake that cost me 600.00,I would like to report that Fort Knox took care of the problem in a very professional manner, I am extremely satisfied with the way Fort Knox handled it and I am very grateful to the person at Fort Knox that took care of me.
3
MakMak12 posts since
Mar 29, 2011
Rep Points: 298
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