Wells Fargo is hoarding your money. They are doing it to the maximum allowable legal bounds, but hoarding it nonetheless.
I get a letter from Wells Fargo telling me my check of $500 has a hold on it for three weeks. The stated reason, I had overdrafts posted to my account in the past six months.
As a student, and for many people out there, we occasionally get overdrafts. It happens, and we apologize and in the end the banks make a lot of money on overdraft charges.
So, I call Wells Fargo and a customer service representative tells me about Regulation CC.
I look up Regulation CC, and here is what it says:
For certain types of deposits, Regulation CC permits financial institutions to delay, for a reasonable period of time, the availability of funds. A reasonable time period is generally defined as one additional business day (making a total of two business days) for on-us checks, five additional business days (total of seven) for local checks, and six additional business days (total of eleven) for nonlocal checks. Banks can hold your money for the following reasons: history of overdrafts, redeposited checks, reasonable cause to doubt collectibility of a check, emergency conditions, and deposits into accounts of new customers.
See http://www.federalreserve. Gov/Pubs/regcc/regcc.htm#delay
The thing is Wells Fargo is using this regulation to hold your money no matter what if you fall within one of these categories. So, the whole idea of "reasonableness" goes out the window for this bank.
The problem is their purpose is not for their own protection - rather they are using the regulation for their own financial gain - holding your money for three weeks (eleven business days) when the funds are good - the funds have been electronically dispursed by the writer of the check. Thus, the bank isn't worried at this point - they have their hands on the money - but they still maintain a hold on it.
This doesn't make sense and it is actionable.
The other thing about regulation CC is that it doesn't mandate these holds, they are entirely discretionary with your bank. Banks can choose to follow these policies.
Wells Fargo has chosen to take the maximum limit allowed by the regulations (eleven days for non-local checks) to carve out a great savings with consumers' funds by applying a blanket hold on your money.
This is a fraudulent policy because it is an exploitation of a valid reg that has a good purpose. And frankly, its not good business Wells Fargo. As a customer of your bank, I am getting out and will make it my priority to inform everyone I know of about Wells Fargo's practice.
It is my hope that a good class action attorney can get their hands on this.
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