Wells Fargo's "savings subaccount" (sweep acct.?)greenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
Whew! I read Uncle Gary's comment about sweep accounts, opened my morning mail and VOILA' there on my latest Wells Fargo statement(s) I read the following blurb:
Wells Fargo Newsline: THIS NOTICE IS FOR INFORMATIONAL PURPOSES ONLY. NO ACTION IS REQUIRED. TO MORE EFFECTIVELY MANAGE THE BANK'S RESERVE REQUIREMENTS, EACH CHECKING ACCOUNT INCLUDES A SAVINGS SUBACCOUNT. THE SUBACCOUNT WILL BE COMPLETELY TRANSPARENT TO YOU AND WILL NOT AFFECT ANY ASPECT OF YOUR RELATIONSHIP WITH THE BANK, INCLUDING YOUR ACCOUNT BALANCES, STATEMENTS OR THE WAY WE PROCESS CHECKS. IF YOU HAVE ANY QUESTIONS PLEASE CONTACT US.
My note: 800-225-5935, press * and wait for live person!
I called this morning about an overcharge on my account and when that had been taken care of I was preparing to hang up when the sweet person asked if there was anything more she could help me with today......Weeellllll, since you ask......can you explain what this notice on my statement means? She had no knowledge about it at all...I was put on hold and after more that 8 minutes she came back triumphantly and explained that this was just a bookkeeping thing and was used when electronic transfers and such happened on my account.
I asked why then does it refer to the Bank's reserve requirements? Back on hold, this time for a long time.....(15-20 minutes?). Now she states that she was just told about this but that I was right...but that it should not affect my banking in any way and that "all the banks are doing it". I expressed my concern about this being the type of thing that undermines public confidence in the banking system, apologized for putting her to so much trouble and signed off.
Called my local credit union, reached a manager who had no clue banks were doing this, she reassured me that it was not credit union policy and that it looked like the banks had found a loophole and could not use checking account money as if it were savings account $, thus greatly reducing even more the Fed required reserve amounts.
This afternoon I called W-F again, determined to get details: Friendly lady #1 said she had no knowledge of the policy...on hold.....comes back and said that "this only happens on inactive accounts, like, if you have a business account with, like, $30,000 in it and no activity month after month, then we would leave, like, 2 or 3 thousand in it - this won't happen to you because you have an active account".
I quietly asked her then why does my statement mention it as fact....she couldn't answer...I apologized for being a nuisance but asked PLEASE - I need more info - "OK but I will have to transfer you to the Executive Office"...very long hold - 12 min? - The new lady asks me how she can help me - I asked her to explain why there was a subaccount on my checking account, she read me information off her computer stating that it was approved by the Fed, to allow W-F to offer more services to customers - to increase the loans that can be offered. She became very impatient when I asked for details such as at what balance would this occur, would I earn interest on the money transferred...she said the only information she could give me was what I already had received. She went on to insist that this will affect me in no way, will not affect my ability to withdraw funds, etc.....that it would be transparent to me.
Frustrated I thanked her for her trouble but told her that in this time of growing concern about worried people panicking at year-end and causing a bank run, this did not seem like a good time to further reduce the reserves at the bank. I also said that it was apparent the upper management was leaving the customer service reps sorely uninformed and that the false and mistaken information and statements made during my calls today actually made it look bad and did not in any way foster my confidence in W-F and in fact made it seem like W-F was trying to sneak something by....she agreed.
Sorry to vent - I needed to do so before my husband gets home and I bombard him with it - he hears enough from me already about all this (is a GI but lets me take care of the details). Anybody else having any better luck finding info on this? Kristi
-- Kristi (securx@Succeed.Net), March 23, 1999
I took the liberty of editing your message so that we could see some paragraph breaks and digest it more easily.
You might want to take a look at yesterdays thread named ALERT - banking sweep accounts to see a more detailed discussion of the bank-sweep phenomenon, which is being carried out by several banks. As I pointed out in my message on that thread, my daughter and I discovered this "loophole" in the summer of 1997, when we were doing research for our Time Bomb 2000 book; but I don't think anyone was paying attention at that point.
-- Ed Yourdon (firstname.lastname@example.org), March 23, 1999.
Since Sweep Accounts have been "around" for some years, were they elective? In other words, it seems that Wells Fargo is making it mandatory to apply this to every checking account. Was it offered as an elective type of account in the past, up until this instance (W.F.)?
-- Mr. Kennedy (email@example.com), March 23, 1999.