MORE ATMS ADDING SURCHARGES; $1.40 AVERAGE FEE AT CASH MACHINES.

Byline: Deborah Adamson Daily News Staff Writer

Led by Bank of America and Wells Fargo, 54 percent of banks in California now assess an Automated Teller Machine surcharge, up from 44 percent a year ago.

The California Public Interest Research Group, a consumer watchdog group based in Los Angeles, said Wednesday that the increase means 77 percent of all ATMs in the state now carry a surcharge on ``foreign'' ATMs.

Consumers pay this fee if they use an ATM outside their own bank's network. The surcharge is paid to the owner of the ATM and another fee is paid to the customer's bank for going outside the system.

For example, a Bank of America customer pays a total of $3.50 by using a Wells Fargo ATM - $1.50 to Wells and $2 to Bank of America.

``Consumers should avoid fee-gouging ATMs as much as possible or use ATMs with no surcharges,'' said Angie Farleigh, spokeswoman for CALPIRG.

A group of banks and credit unions such as Glendale Federal, Sanwa, Sumitomo and Union Bank, formed a ``No Surcharge Alliance'' early last year to promote the fact that their customers do not face the extra fees. Glendale Federal dropped out of the alliance several months later.

CALPIRG reported that the average surcharge in the state is $1.40, down a nickel from a year ago because more banks have started charging the fee and usually charge $1 per transaction when they initiate the surcharge.

Nationwide, 71 percent of 470 banks in 28 states levy such a fee, up from 45 percent a year ago, according to a survey released Wednesday by CALPIRG's parent, the U.S. Public Interest Research Group. The average transaction fee has risen to $1.23 from $1.15 a year ago.

Surcharging rates are the highest in North Carolina, Virginia, Tennessee, Arkansas, Indiana, Minnesota and New Mexico. All ATMs in those states carry surcharges.

Banks are charging more for ATM transactions because the machines offer more services at more locations than ever before, the American Bankers Association in Washington told The Associated Press. The biggest increases have come at ATMs owned by companies other than banks, the banking trade group asserted.

The national study also showed 83 percent of bigger banks levy the surcharges, compared to 65 percent for smaller banks. Big bank surcharges average $1.35 nationally compared with $1.16 for their smaller rivals.

These surcharges add $2.5 billion to $3 billion to bank coffers a year.

Interestingly, the only Wells Fargo ATM that does not impose a surcharge is the one in the basement of the California state Capitol building, CALPIRG said.