The bank/credit union stopped paying interest on my money market account because I wrote too many checks. Can the bank do this?
Maybe. You can only make six total transactions per calendar month or statement cycle on money market accounts by check, debit card purchase, and electronic transfer. You can make unlimited withdrawals or transfers by ATM, in person, by mail, messenger, or telephone check (where payment is made using your account number and bank routing number).
Your bank or credit union must prevent withdrawals or transfers exceeding these limits and must contact you if you exceed them. If you continue to exceed these limits after the bank or credit union has contacted you, the bank or credit union must either:
- Close the account and place the funds in a transactional account such as a checking account that does not pay interest; or
- Take away the transfer or check writing capabilities of the account.
If you wrote too many checks and your bank or credit union places your money into a checking account, you may no longer earn interest.