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Wells Fargo Closed Their Accounts, but the Fees Continued to Mount (nytimes.com)
135 points by howard941 61 days ago | hide | past | web | favorite | 75 comments

A spokesman for the bank said... the bank reviews accounts to protect customers and was “committed to doing so in ways that minimize the risk and impact to our customers.”

“As a company, we are focused on continually improving this process,” said the spokesman, Jim Seitz.

Sounds like Wells Fargo has the same doublespeak PR department as Facebook.

A bank isn't supposed to "continually improve the process." The whole point of a bank is that it's supposed to do things right the first time.

Perhaps the "process" they are improving is the number of "perfectly legal"/"plausibly deniable" ways they can take money from people?

Wells Fargo has been in the news for one fiasco or another for 20 years. How are they still in business? Their reputation is terrible. I guess people don’t talk about their banks that much.

Wells, Fargo, Bank of America were purchased by shady operators specifically for their reputations, which the acquirers have been slowly spending down since.

The good news is that all the good banks have already been strip-mined so that there won't be a second wave of this.

The bad news is that all that's left in the US is shitty banks. I use a credit union for my personal money, but for my companies SVB is about the best I can find. At least they don't engage in shenanigans like this.

> I use a credit union for my personal money, but for my companies SVB is about the best I can find.

I totally agree about credit unions vs. banks; at this point I am leery about dealing with any financial institution that doesn't have "Federal Credit Union" in its name.

I think most credit unions will work with you to open a business account if you are already known to them as a personal member.

> I think most credit unions will work with you to open a business account if you are already known to them as a personal member.

True, but they are really set up for small businesses, not startups.

> they are really set up for small businesses, not startups

Hm, yes, fair point.

This is not the same trustworthy WF we grew up with on the west coast. After they merged with the Minneapolis bank, it has been one scandal and dark pattern after another.

The big banks are some of the owners of America. I'm talking they're paid up huge with the right people with most other sectors depending on them, too. You can tell whose on the list in some way by looking at who made the bail out happen with the biggest amounts after the 2008 financial crisis. Goldman Sachs appears to have led that with the Treasury head being an ex-CEO. With that level of subversion, they can get away with a lot.

Previously, they got a trillion dollars or so in bailouts, some billions in fines, little control of how they spent the bailouts, and criminal immunity for what led to it. Then, banks like Wells Fargo kept pulling every scam they could on the taxpayer with basically no response from the government. Yeah, they all own the government exploiting it to their benefit. Expect them to do more since it's their country. You always know by looking at who pays [massively] and who gets paid [massively] in unjust ways.

Been wellfargo customer for 20+ years. Good Service, Local branches to walk into. I believe issues like these are exception cases.

Wellsfargo is good if you are not running into edge cases. In other words, if you are paying cards, mortgage payments 15 days in advance, if you are keeping nice bank balance in your checking accounts, no issues. The moment you try to do things per the book, they'll screw you.

Why does Wells Fargo keep getting caught engaging in illegal and/or fraudulent activity? What does Wells Fargo offer that a local credit union doesn't?

I’m curious why this is being downvoted? Are people here really downvoting someone because they haven’t had a bad experience at a certain place you don’t like?

No, because they extrapolate from their experience that all the problems have to be "exceptional cases", when there's good arguments that a lot of problems at WF are not that, but systemic problems and outright fraud causing damage to millions of people.


well, that and moving large sums of money isn't quite as easy as say changing email providers

> well, that and moving large sums of money isn't quite as easy as say changing email providers

In what ways? If you close your account they need to give you all of your money at the time of closure.

Having worked at a bank, I can tell you that they are scared by how mobile millennials are with their money. They will literally follow the interest rates. With most millennials using credit and not debit/ach, it becomes even easier to move to a new banking provider.

thanks for your reply, i'm truly interested in this as i have money stuck in a low interest checking account that i want to move to Simple. i'm in the US.

if i have $50K in a checking account they're obligated to write me a check (?) for $50K if i tell them i want to close my account?

if that's correct, does the amount matter? when do AML/KYC laws kick in? will these online focused banks accept new accounts funded with checks over $10K?

For large amounts of money, I think the best way is to open your new account, wire transfer (not ACH or check) the money to your new account, confirm that the funds are received, then close the old account. This will likely cost ~$25 depending on your old bank but it avoids the hold periods you'll otherwise get with a check (even a cashier's check) or ACH transfer, as well as issues with moving physical cash.

You don't need to worry about AML/KYC laws, those are the bank's problem. In fact, using smaller transfers to avoid hitting the $10k threshold is illegal.

The only significance of $10,000 is that it’s the amount that triggers reporting. Such transactions aren’t illegal or even suspicious. They’ll write you a check for the full amount and the other bank will accept it. There might be a hold on the funds for several days until the check clears. As another commenter mentions, you can open the new account first and do an electronic transfer which will make the funds available sooner.

Just do a ACH balance transfer, move your bills, then close the account. No need to be driving a paper check around.

If you'll think billing problems will occur, break the transfer into two chunks and keep both accounts open for two months or so until satisfied.

depending on your original account, if it has a minimum balance to avoid fees you might want to leave the minimum balance in there and transfer the rest first. Then close the account officially and get a check for the remainder. the reason is that if you transfer it all and it goes under a minimum deposit, you could get a fee and then you are overdrawn, generating more fees and more overdraw. Generally just taking all money out of an account doesn't automatically close it.

But, closing an account does result in all of the money coming out, avoiding any potential balance issues since the deposit is refunded upon closure, in full.

The bank informed Mr. Einaudi that it was closing all 13 of the checking accounts it provided his roofing company, CRV Construction, for a reason it called “confidential.”

Citibank did that to two of my accounts. Good thing they weren't with Wells Fargo, or I probably would have gotten the same treatment. But I still get messages from Citibank about the phantom accounts and how I'm not maximizing their potential. Amazingly, I can still log in to the accounts online and see that they are closed.

> The bank informed Mr. Einaudi that it was closing all 13 of the checking accounts it provided his roofing company, CRV Construction, for a reason it called “confidential.”

> Citibank did that to two of my accounts. Good thing they weren't with Wells Fargo, or I probably would have gotten the same treatment. But I still get messages from Citibank about the phantom accounts and how I'm not maximizing their potential. Amazingly, I can still log in to the accounts online and see that they are closed.

They probably have to retain login to allow export of your statements.

Note Wells Fargo bought two banks I had accounts in. That is an unplanned way I had accounts in their banks.

Same here. My first account was at a Wachovia, but they fell apart during the recession and were acquired by WF. Looking for a convenient time to switch.

In 2002, I opened an credit card account with Wells Fargo. I went to the local wells fargo to pay the monthly due on the due-by date. In the next billing cycle, I was charged $25 for late payment. That's when I decided to close accounts with them.

I had a Wells Fargo account for a number of years. Then one day I deposited about $250 cash into a Wells Fargo ATM. But it didn't show up in my account.

When I complained, Fargo treated me like I was a criminal. It wouldn't credit me for the money, even though I had the ATM receipt. The branch manager told me he wouldn't even review the security video unless I filed a police report about it.

I drained the account to zero and ignored it. Six months later, I get a letter from Fargo saying that a guy who worked for a company they outsourced ATM maintenance to was skimming cash from the machines. Fargo finally credited me for the missing money, and I closed the account the next week.

Very similar story here.

Every bank since WF that i've interacted with has been splendid; I think it's just that WF set such a low floor for expectations that ANY decent bank seems far ahead.

You should have also reported them to the Office of the Comptroller of the Currency, a little known regulatory office that no one ever seems to know about, but govern such cases like yours.

Branch manager may have been in on the graft with the ATM maintenance guy.

Wow. If they would've did their job they've prevent six months of theft. That's sad.

I had a brokerage account that I closed out by transferring all of my stock and cash to another brokerage. Apparently they failed to transfer it all and left 2¢ in the account. For nearly 10 years I’ve been receiving mailed statements from the old brokerage with my account details. I wonder how many other accounts are in this limbo, and how much postage (now over 50¢!) is being wasted on these mailed statements.

I’m glad my only inconvenience is having to recycle the monthly mailings, and not mounting fees, like the people at Wells Fargo!

I have an ETrade account like this.

This is disturbing. Previous problems weren’t apparently affecting business accounts but this one is. Many of us are required to have a primary operating account with Wells as part of a loan agreement.

You most likely received a discounted interest rate on your loan in-line with anti-typing exceptions outlined in 12 CFR 225.7

For reference: https://www.occ.treas.gov/news-issuances/bulletins/1995/bull...

It says they have an exception when tying traditional bank products together, like a loan and a deposit account.

This happened to me. It was a nightmare. Glad to know I wasn't the only one.

What's everyone's preferred bank? I want something with ATMs everywhere, good international travel support, and a not-horrible website I can move stuff around in/monitor with. I'm in SF.

Wells Fargo has checked those boxes for me, and never done me wrong, but they keep screwing over other people. Maybe I should take my money elsewhere.

Fidelity has a good banking service and credit card system. If your retirement / investment accounts are at Fidelity, it's really convenient.

They do have "branches" in larger cities, where you can deposit large checks, but they won't cash checks or give you money there.

The ATM card automatically refunds you for fees using any one else's bank, which is really nice. This means any ATM is your ATM. The Fidelity credit cards are okay, but they do charge an international transaction fee for currency exchange, which I think is 1% (better than most, but not 0). The website is nice, functional, and the same website for investments/401k/savings/credit cards, and they offer a fair amount of security (2FA) for it. Their phone support is pretty good.

I've only been banking at places that don't have physical branches for the last 15 or so years, and that has only made me happier. Then again, I don't need to interact with a teller on a regular basis.

The interest rates are not good at Fidelity though. So for long term savings, I bank with Ally, and use the websites to transfer money between them. Ally I'd also consider top notch.

Charles Schwab is even better. Same deal, but no international fees period. I also have an interest bearing checking account that pays way more than any brick and mortar bank.

I moved almost all my money to Fidelity. They're not a bank, but very close to one. The best thing is ATM everywhere: they reimburse ATM fees as soon as the transaction posts. The promotional material says the reimbursement occurs nationwide but in practice worldwide, so even international ATM withdrawals are free of fees. Unlike most banks, they also pay interest on their cash management account (1.08% APY as of now) but you can buy SPRXX or any other money market mutual fund with higher yield and a stable NAV, and these will be auto-liquidated when you move money out (SPRXX has a 7-day yield of 2.08% as of 7/31).

For purchases I don't recommend using money in the bank any more (i.e. don't use a debit card). Use a credit card for better protection and pay the credit card from the cash management account. You don't have to get a credit card from the same place you bank. Fidelity has a BillPay feature to initiate payment from your account to the credit card, or you can give your credit card company the ACH account and routing numbers.

The only thing I find lacking is the occasional cash deposit. But you can just buy a money order and deposit that.

Also learning to use a brokerage account with cash management features has a steeper learning curve than a bank account, but the average HNer will have no difficulty.

Schwab is your move, IMO. I know a ton of people who moved from WF to Schwab and never looked back. Zero international ATM fees and great customer service. Solid app too.

Charles Schwab (the person) is a major trump supporter. Charles Schwab bank has been quite good and unlike the cma offered by fidelity and other brokers it's an actual bank account.

I use alliant federal credit union -- setting up the account took but a moment.

I hear good things about tech federal and Stanford credit union (I think you need a Stanford connection).

Same here. High interest on savings and free ATM usage on checking.

Local credit union. Many of them share ATMs as a part of some ATM co-op network.

If you don't need physical bank branches, use Charles Schwab Bank. Their checking account is nice and they will reimburse you for _all_ ATM fees worldwide; it's an onramp to their brokerage products, so it can only be opened alongside a brokerage account, but neither account will have fees or minimums.

I'm with Wells Fargo and I'm not planning to leave. I don't think any of the other banks are morally superior -- Wells Fargo is probably just a bit more inept at covering things up.

This is a great point. I did move from Wells Fargo to a credit union, and this was a move from unhappy to happy. But as the larger point, I cannot boycott every business I have a bad experience with, or that is somehow unethical, I'd starve to death, so to speak.

I think they're comparable to other national retail bank chains, and just a bit worse at image control. However, others here have suggested credit unions or brokerages with banking arms, which have different incentives - anecdotally, people are happier with service from non-bank banks.

The problem with local credit unions is their smartphone apps and online banking suck.

Agree. I heard that there are four primary vendors for credit union and small bank web software. I guess they're not typically able or willing to customize commodity or write custom mobile apps.

I use two banks. Schwab for checking, as others have said, they’re excellent.

Discover for savings for that 2% interest.

I’ve tried other online only banks, ally for instance. But discover is the only one I’ve found with no fees to order more checks, no fees for maintenance in general, and a pretty great customer support to boot. My only complaint is the slow transaction log. For instance when I pay my credit card, it takes almodt 3 days to show up.

It’s why I moved my checkings to Schwab instead. Almost the same benefits with no fees, no hassle.

Local credit union for checking, mostly because I’ve had it forever. I am a big discover bank fan, as they’re keep their high yield savings rates in the top 5 consistently. Mobile check deposits are super easy too. I recently made the switch to Wealthfront savings accounts due to their savings rate but keep all my accounts open.

I pay for everything with a rewards credit card, and use the ATM (or cash in general) maybe once or twice a year so ATM fees aren’t a concern for me.

USAA for me. They have no fees and you can use any ATM and they’ll refund you the fee the other bank charges.

I have seen many articles go to 1,500 or more comments at NY Times. Is it usual for The NY Times to close their comments section after only 18 or so hours and just 230~ comments?

I don't read newspaper article comments, but it's possible that an anti-spam system kicked in. It's not like newspapers have people watching the comments on every article.

This may just be a rate-limiting tactic inside an antispam system, that allows comments later or in different areas.

Just avoid any large bank. Stick to credit unions and and local banks that you know something about. I was given this advice a long time ago and it has saved endless hassle.

Local credit unions are definitely the way to go.

I use Wells Fargo and get very good service at my local bank. That said, we also use two local credit unions and supporting smaller banks is, I think, a good thing to do.

Bank of the West is 100x better.

Then the accounts were not closed, simple as that.

IMHO, this is criminal.

> IMHO, this is criminal.

Is criminality opinion nowadays? To my understanding if a bank acts like this, there is very little to do. Maybe a class action lawsuit would work in US?

IIUC, one intended role of a judge is to reach an opinion about the criminality of some act. So I'd say yes.

Edit: I assume we're talking about opinion as judgment of objective matters, not opinion as statement of personal preference.

So let me tell you how the class action would go down. A law firm would find a few impacted folks. They would then file for a class action covering, let's say, 100K people.

WF would then agree to pay like $50M. The lawyers would take at least half of that or $25M. The 'few impacted folks' the lawyers originally found would get between 50K and 100K each. The remainder would be disbursed to nonprofits because it would be too onerous to find all defendants.

WF would get this monkey off its back. And the actual impacted folks would get zip, zilch, nada.

You forgot to mention that the wrongful behavior would cease. That's the point of a class action: It provides an effective state attorney without tapping the public treasury.

Not if they made more money ripping people off than it cost them in the courts. Even if they didn't make a full $50 million in this scam, time value of money means they get to capture earnings on the scammed money for a decade before they have to finally pay a penalty.

THEN they get to offset $50 million of current income to reduce their tax bill. I'm surprised more banks don't do this.

> Not if they made more money ripping people off than it cost them in the courts.

This is why class actions can assess punitive damages.


They don’t give a shit about their reputation.

It is my opinion this action could be criminal under existing law.

Basic misrepresentation.

Closed has a clear and expected meaning.

FWIW, last time I closed a bank account I asked for a signature indicating I had no further financial obligation.

This crap has happened before.

WF got caught opening mass numbers of accounts for customers who didn't ask for them resulting in fees as well. They didn't get in trouble for that either. It was systematic corruption. You don't get that many employees doing it unless it is approved.


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