Illustration by James Yang.

Attempting to regulate large companies is like trying to dam a large river. You may change the way the water flows, but you’re not going to stop that water from running. When banks were hit with new government regulations in 2010 limiting or eliminating fees they could charge their customers, they hit back. They complied with the rules, sure enough, but they shifted the fees to different transactions. At stake were billions of dollars per year—money the banks were counting on to keep them in the black.

The banks assumed consumers would not notice the new, tiny fees tucked away under vague, misleading headings in monthly statements. Or, if people did notice, banks counted on them to quietly suffer with the new fees, as they usually do.

Boy, were they wrong! The surprising (to them!) breaking point came last fall in the form of a proposal by Bank of America and others to charge $5 per month for the privilege of using their bank-provided debit cards. That fee was shelved after igniting a massive public outcry, the Occupy Wall Street movement, and a well-publicized exodus of big bank customers to the fee-friendlier waters of credit unions and smaller community banks.

But other fees quickly and more quietly took its place—and then some.

Now, lose that debit card and Bank of America charges $5 for a replacement (or $20 if you want rush delivery). Need a teller? Its eBanking enrollees have to pay $8.95 each month they use one to make a transaction. And most recently, the behemoth bank has been testing a menu of new checking account fees as high as $25 a month.

Bank of America is not alone. In 2009, before the Credit Card Accountability Responsibility and Disclosure (CARD) Act ended sudden interest-rate hikes and other money-making “gotchas” on credit card accounts (whose plastic is often issued by big banks), nearly all of the major players offered free checking.

Today, Citibank charges $20 a month unless you keep at least $15,000 in deposits—up from a $6,000 minimum balance in December. At Wells Fargo, expect a $15 monthly charge unless you have at least three accounts, maintain a $7,500 balance, or carry a Wells Fargo mortgage. No matter where you bank, it costs an average of nearly $8 a month in fees for basic (and longtime “free”) checking and ATM use, a 21 percent increase from six years ago. And a checking account isn’t the only service where fee has replaced “free.” Want a paper statement at month’s end or a photocopy of a past transaction? Making a deposit with your mobile phone or receiving one sent by wire transfer? Don’t have, in your bank’s view, enough account “activity” in a given month or need to cash in too many coins? There’s a fee for each at some banks, from 50 cents to a few bucks per use. Meanwhile, fees for longtime services have also increased: Cashier’s checks that used to cost $3 now cost up to four times as much, while money orders have doubled.

Outraged by it all? You’re in good company. In the 90 days following last November 5, the so-called Bank Transfer Day ignited by a 27-year-old art dealer’s Facebook post urging consumers to flee the ever-growing fees of big banks, nearly six million heeded the call—and moved their money to credit unions, which have lower or no fees for many of the same services. (As nonprofits, their tax-exempt status is one reason.) Guess what? There’s a fee for closing a recently opened account: $25 at CitiBank, PNC, U.S. Bank, and Sovereign, and some smaller financial institutions demand up to $50. All told, this nickel-and-diming amounts to some serious coin. Last year, $41 billion in fees alone was generated for America’s financial institutions—including $9.5 billion for “everyday” (and sometimes previously no-cost) services on customers who never overdraw their accounts.

Bigger banks, with higher operating costs, tend to be the biggest offenders. They have an average of 49 different fees, according to a study by Pew Charitable Trusts—ranging from $1.50 for a Xerox page to $175 to drill open a safe deposit box if keys are lost. Many are buried deep in government-mandated “disclosures” statements that now typically run 111 pages long, and are “full of legalese” not easily digested by many customers, says Pew’s Ardie Hollifield.

Overall, fees are fewer and less expensive at smaller banks and credit unions. “You’ll pay roughly one-third fewer fees at a credit union or smaller regional or community as opposed to a mega bank,” says Michael Moebs, CEO of Moebs Services Inc., which conducts independent research about banking services and fees for the financial industry’s federal regulators. “Bigger banks charge higher fees because they have to. There’s a huge cost in having 10,000 braches scattered across the U.S.”

Attack of the Killer Fees The Saturday Evening Post