I’m writing a series of posts about my experiences with Wells Fargo to document its unethical and/or incompetent business practices in handling my personal accounts over the past 3.5 years. We will be moving our 4 personal and 3 business accounts to one or more other banks very soon — just as soon as this last episode of our mishandled mortgage account draws to a close.
Disclaimer: I have had experience with a handful of banks and various types of accounts. I can’t speak to the quality of service for any banks I haven’t used, obviously. It’s quite possible that other banks are just as bad, but that’s no excuse for poor customer service and unethical business practices.
My main complaints involve our home mortgage loan administered by Wells Fargo, but before I get into those, let’s get some of the more minor annoyances out of the way.
Wells Fargo (and probably most large banks) hold on to your money as long as legally possible as a matter of policy. I won’t pretend to know a whole lot about high finance, but obviously, the longer they can hold on to your money and use it to their own ends (e.g., invest it), the better for their bottom line. While technically not illegal, it does present some problems. First and foremost, of course, it makes your customers wait for their money, which very realistically leads to anxiety as they try to make ends meet.
Second, unforeseen issues can and do occur that prevent the timely disbursement of funds. Checks get lost in the mail. People make mistakes. By waiting until the last possible moment, banks ensure that any error causes the disbursement to in fact be late. If banks would just stop dicking with their customers and pay up right away, errors could be corrected within a reasonable timeframe.
More than anything else, this typifies the culture of greed that pervades most large banking institutions. Instead of considering what is best for their customers, they are constantly pushing to see what they can legally get away with. In many cases, they blatantly break laws simply because nobody will call them on it.
Don’t get me wrong: I understand that banks do not exist solely for my convenience and are entitled to make a profit, but there are ethical and unethical ways to go about business. I own a company. I pay my bills on time. When I owe a person money, I almost always pay right away unless there is a valid reason not to do so.
I recently transferred some stocks into a brokerage account administered by Wells Fargo. At the time, I thought this was great because I could then transfer the proceeds of stock sales into my other WF accounts very easily. How quick and convenient! No. I quickly learned that getting my money from the sale of my stocks is actually about a week long process. I put in the sell order and it gets executed the very next business day. WF charges me a flat fee for the transaction. Fine. The money is immediately available for me to purchase additional stocks, but not to withdraw. No, to actually get at my money, I have to wait until Friday when they do a cash sweep — and that’s if my sell order was done at least 3 business days prior to that week’s sweep.
Perhaps some informed individual can point out a technical reason why Wells Fargo (or banks in general) operate like this, but I doubt your reasoning will be altogether convincing. There are sometimes legitimate reasons for information systems to process certain kinds of transactions at certain times of the day. For example, resource intensive processes can occur in the dead of the night when bogged down systems will be relatively unnoticed by consumers. I could also see cash sweeps taking place after market closing each day. That the transaction cannot occur instantaneously is already somewhat untenable, but I’m willing to grant that there may be some legal or technical reason I am unaware of that would prevent processing until the middle of the night. Any longer wait period than that is simply unfathomable from a technical perspective.
Mind you, I would fully expect that a transfer from one bank to another might take 2 or 3 business days. That would be understandable. But a full week for an internal transfer? Nonsense.
That’s just one example, of which there are many. I’m also more than a little perturbed that Wells Fargo has seen fit to change its terms on our free checking account to charge a $13 monthly fee for it. For a while it didn’t matter, because their new terms stipulated that the checking account would remain free so long as we had our mortgage with them. But since we have refinanced, we are now being hit with new fees after 4.5 years of it being free.
Which brings me to our story of woe. If you were considering using Wells Fargo for your next home mortgage, this could very well change your mind.