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Court Rules Wells Fargo Illegally Processed Transactions In A Way To Bounce Checks

Tuesday, August 10, 2010 - 7:15 PM
Federal judge in San Francisco rules against Wells Fargo in action over it processing larger debits before smaller debits, regardless of which comes in first, in what the court ruled was an illegal effort to cause maximum bounced checks and bounced check charges. Court orders Wells Fargo to pay $203 million fine.

http://www.latimes.com/business/la-fi-wells-20100810,0,5994603.story

This is VERY similar to the practice by Alliant Credit Union that I complained about in this forum previously. Alliant allows you to access your account online and set up transfers between accounts to be done on a future date. However, I found out he hard way that Alliant choses not to do that transfer that you set up in advance until later at night. But all day long as checks or other debits come in through the ACH, Alliant processes them -- and will bounce them for lack of the funds that transfer was designed to cover! When the day is over and all the ACH debits have been handled -- and bounced, with the resultant bounce fees, if they needed that transfer -- only then does Alliant put the transfer you set up in advance into your account!

What Alliant is doing is even worse than what Wells Fargo was doing!
3
me1004me1004370 posts since
Jan 16, 2010
Rep Points: 2,568
1. Tuesday, August 10, 2010 - 8:03 PM
It would seem to be prudent to make any ACH deposits to a checking/savings account a day or two before one knows debits are likely to arrive.  Trying to maintain a zero sum balance in a checking/savings account is risky.  Why take the chance of losing dollars to save a few pennies in interest . . . especially in our current low interest environment? 
5
AlanAlan33 posts since
Jun 7, 2010
Rep Points: 206
2. Tuesday, August 10, 2010 - 10:05 PM
I wonder if banks that processed the larger checks first before the smaller ones will also be fined. I worked at a larger bank that did that. We were told to tell the customer the reason the bank did it was because the larger checks were more likely to be a house payment, car payment etc. YOU CERTAINLY WOULD NOT WANT THAT CHECK TO BOUNCE WOULD YOU?
2
Ally6770Ally6770909 posts since
Jan 16, 2010
Rep Points: 2,643
3. Wednesday, August 11, 2010 - 5:20 AM
The judge's ruling is very interesting on disclosures and the marketing games. The judge was very angry

http://graphics8.nytimes.com/packages/pdf/business/20100811-wells.pdf
1
cactuscactus51 posts since
Jan 17, 2010
Rep Points: 382
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