Consumer complaint received 2018-04-27
Company: WELLS FARGO & COMPANY
State: CA
Product: Checking or savings account
Sub-product: Checking account
Issue: Problem caused by your funds being low
Sub-issue: Non-sufficient funds and associated fees

Complaint:
The Company is Wells Fargo Bank.

I have noticed that this is an ongoing problem and when I have mentioned it to friends, they complain of same irresponsible strategy to take money from those that have the least money to spare. Wells Fargo, it seems evident, has been using a very unethical tactic to continue to gouge poor customers with " insufficient funds '' penalties. Sometimes the insufficient funds is a couple dollars, but still the fine is {$35.00}. The practice I explain below is a smoke and mirror approach to trick customers into not having sufficient funds by Wells Fargo not ethically and properly accounting for all use of the ATM card.

The problem occurs when I use my ATM card to pay my house bills or order items online, especially from XXXX. This seems to happen a lot with bills listed in bank statement as " recurring payment '' and online purchases like amazon listed as " purchase authorized '' - it doesn't happen when I make an in person purchase with my card at the grocery store etc. With the changes brought about by digital payments, I no longer use nor keep a checkbook with record of my transactions - I don't think most people do that any more. So we rely on our phone bank app to tell us how much we have available in our accounts.

What has happening is that when such purchases as described above are made, often the purchase is " authorized '' by Wells Fargo and identified under " pending transaction '' on the Wells Fargo app, so it obviously was approved by Wells Fargo, but then that same evening, when the bank does its days accounting, it disappears from " pending transactions '' and is no longer accounted for in the " available balance '' on the account. With modern computing capability, this is a problem that can easily be remedied with coding if Wells Fargo wanted to fix this. The problem is that then the customer is has to keep track of any payments, made and authorized by Wells Fargo that it is not accounting for and that the customer has to keep remembering that the " available balance '' showing is actually not correct and is actually less than shown.

Just with XXXX, since XXXX first gets the charge authorized then does not actually charge the card until they ship the item, but also for example with XXXX and XXXX because I make a payment and for some reason it takes few days before it actually gets charged into the account, Wells Fargo has been collecting over and over again the penalty for insufficient funds when it failed to keep proper accounting on the app for the customer. Actually showing wrong information and expecting the customer to know this. I know that sometimes a charge is authorized and stays in pending for a week or so and will fall off if the charge never actually gets processed. I am not referring to these. This disappearance act is happening within a day or two of getting authorized.

Since those most likely to have insufficient funds are poor people, it seems like a very unethical and irresponsible practice that needs to be fixed.

I have selected in my account the option to not have Wells Fargo make a payment if their are insufficient funds. They claim that this can not be applied to pre-approved recurring payments or authorized card purchases. Yet if they can not keep proper accounting, then it seems like a scam to charge fees.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation