Dear Bob,
I keep reading all of the terrible news about how Wells Fargo has ripped off their customers. I am a customer and have been for decades. I often wonder if I should move my accounts. What do you think?
"Wells Fargo to Pay Record CFPB Fine to Settle Allegations It Harmed Customers - Bank's settlement includes a $1.7 billion penalty, the consumer agency's largest ever."
It has been well documented that through the last ten-plus years, Wells Fargo has allegedly been ripping off its customer base. Everything from overcharging fees, charging fees where they weren't even applicable, opening up accounts in people's names, over-drafting customers when they had money in their account to avoid it…quite frankly, I am at the point with this story where I can't keep up with the accusations. Bottom line is that this bank, at its worst, has clearly committed fraud as well as Identity Theft. What else do you call opening up fake accounts in your customers' names without their permission or signature?
No one went to jail (thanks to our political system), and Wells Fargo still proudly trades on the New York Stock Exchange as they are allowed to be one of the biggest banks in the world. The regulators know this for a fact. Wells Fargo is too big to fail. So, regulators just charge them with penalties. Even though 1.7 billion is a hefty fine, it doesn't even seem to be material in the day-to-day banking of Wells Fargo.
Should you move your money to another bank?
That is a tough question because moving everything from Bank A to Bank B takes real effort if you have banked with a bank for a long time. Plus, if you were lucky, you have made strong relationships in your local neighborhood branch. I would, however, think twice about keeping savings accounts with them. Those are pretty easy to move. Personally for me, I wouldn't choose Wells Fargo to open up a new account.
Are you at risk of being a part of the next scandal?
Like the athlete with a known history of failing drug tests – all eyes are always on that athlete, watching for one misstep, and they are gone. Wells Fargo is probably the most overly regulated bank at this point. So, you are probably pretty safeguarded for a good long period of time.
Let's just say Wells Fargo is on their best behavior. However, for your personal banking, I would recommend the next allegation would be three strikes, and you are out. After the third strike, the benefit of the doubt should be removed.
Bob will be presenting a 50-minute webinar entitled 2023 and your money on Saturday, February 4th at 10:00 AM CST. Sign up here.