When mulch is piled up against the trunk of a tree, it's called a mulch volcano. While still a fairly common practice, particularly with landscaping services, it is commonly frowned upon within horticultural communities. Potential problems include lack of air circulation at the base of the tree, blocking tree root access to water, encouraging unnatural root growth within the mulch, fungal and bacterial growth on tree bark, and rodent damage. Plus, it just looks odd. This said, there is little research about the potential harm of mulch volcanoes, so, while we suspect they are not good for trees, we do not have studies to confirm this.