Monday, July 11, 2011

Legal Piracy

Banks continue to take advantage of customers. At least mine (The bank will remain anonymous...I'll call it "Stagecoach Bank") does. Apparently, the recent financial blowout of the country's economic stability has taught large banks nothing about customer care. Or, come to think of it, maybe it taught them quite a lot about what they do not have to do for customers.

Earlier this year, I called Stagecoach Bank because they had not sent me a statement of my interest earnings for 2010. When I finally was able to talk to an online "banker," I was shocked to learn why:

Me: "I didn't receive a form that tells me my interest earnings."
Bank voice (after looking up the account): "I'm sorry sir, we don't send tax statements out if it is under a certain amount."
Me: "Well, can you tell me how much it was?"
Bank voice: "It was 52 cents."
Me: (Initial response deleted). "Are you serious?"
Bank voice: "Yes, sir. Fifty-two cents."

After composing myself, I asked the voice, "Well, how much interest do you charge customers you loan my money to?"
Bank voice: "I'm sorry sir, we can't give out that information over the phone."
Me: "Let me guess, then: It's a bit more than you pay me for using my money, is that correct?"
Bank voice: "It depends on the use, sir." (I was getting annoyed by being called "Sir.")
Me: "How much do you charge me each month to keep my savings account open?"
Bank voice: "We charge five dollars a month service fee."
Me: "Does it seem fair to you that I pay YOU $60 a year for you to use my money, and you give me back fifty-two cents?"
Bank voice: "I understand what you mean, sir."

I closed my account and transferred my savings to my checking account. In the big banking world scheme of things, it was a tiny amount, but I'm all about principles. I felt a lot better.

Last month, I opened a savings account in another bank, a small local institution, and called Stagecoach to transfer funds to the other bank. All went swimmingly until I checked online and found that Stagecoach Bank had debited my account (read "taken my money"), but it had not shown up in the other bank. It was time for another call.

Me: "I see you have taken money from my acount, but it has not been sent to my other bank."
Bank voice: "It takes 3-5 days to transfer, sir." (There they go with "sir" again)
Me: "Why is that? Isn't it an electronic transfer?"
Bank voice: "Yes it is."
Me: "Then shouldn't the time scale be in milliseconds rather than days?"
Bank voice: "That is the policy, sir."
Me: "Well, if it is not in either bank, where is it?"
Bank voice: "It has gone to a holding account, sir."
Me: "Why is it being held?"
Bank voice: "It takes--"
Me: "Yeah, 3-5 business days. Look, I could withdraw the funds from a branch in Iowa and drive the money to Maine and deposit it in less time. What are you doing with the money?"
Bank voice (After a pause): "I...really don't know what is being done with it."
Me: "Think: Since it takes only 24 hours to transfer the funds WITHIN the Wells Fargo system, why do you think it has to take up to five days to go to another bank?"
Bank voice: "I'm not sure."
Me: "Well, if you had some money and knew you had five days before you had to send it, what would you do if you were a good investment banker?"
Bank voice: "I see what you're getting at, sir."
Me: "Look, I know they don't tell you these kinds of things, and I'm not blaming you. But I do want you to tell your supervisor that I'm not happy about this."

To underscore my pointing out of this legal piracy, here's what happens when I have money deposited into my savings account in THAILAND and have it wired to my Stagecoach account: The deposit into my foreign bank AND the wire transfer AND the funds appearing in my U.S. Stagecoach account took less than 24 hours. In fact, it all happened the same business day.

We could use a real-life "It's a Wonderful Life." We need a lot of George Baileys more than ever before. One thing is certain: George doesn't work for Stagecoach Bank.


drbruce said...

Oh yes, I'm all too familiar with the irritations of the banking industry. I used to use Stagecoach Bank when I lived in Berkeley. Switch to another, but not much difference really. Electronic banking still has a ways to go I'm afraid.

John Stiles said...

I'm planning to join a credit union. The megabanks are on the greed bandwagon!