Wells Fargo Small Business Account Screw Job
5 min read
This post is hard to write because I have been with Wells Fargo/Norwest since I was a teenager. Pushing 30 years. Like with any business there have been a few bumps along the way but over all a great experience. Until recently.
The explanation of this particular story may show that I am in the wrong in how I read and understood the legal mumbo jumbo but I will explain my thought process and let you decide.
Here’s the situation. I am managing fundraising efforts for a group (doesn’t matter what). I got an IRS tax ID, incoporated the group, state paperwork in order all the ducks in a row. The last step after that was to get a bank account to store the funds and make various payments that we need to. As I have had a long, fairly happy relationship with Wells Fargo I took my business there.
The bankers were fantastic, the process was smooth and they explained everything. However, this is where what was explained to what actually happens breakdown. I want to be clear, the Wells Fargo bankers did everything perfectly and in no way is it the branch employees’ fault. It’s the corporate setup on the business accounts and their supporting documentation that is not what it seems.
It’s been month and everything was fine. We were raising funds and making deposits. Paying our bills and on top of things.
Then a Transaction Fee pops up as a withdrawl. Odd.
I go through the paperwork and look at my Small Business Simple Checking terms and even read the Fee Schedule. Nothing in there would show me that we had a fee to pay.
Our current balance was well above the minimum, nope. We didn’t deposit more than $3,000 in a month in cash, nope. We didn’t make 50 transactions in a month, nope. So I call to get clarification.
Once I got someone on the phone that’s when I realized the trickery and pitfall of the Small Business Account setups. The lady on the phone said we DID make more than 50 transactions in September. The first 50 are free then it’s $0.50 for each one thereafter.
STOP – I am looking at my Account Summary and since I was the one that made the deposits and sent one check out, I know I did not make 50 transactions. Online I can see I didn’t make 50.
How can that be, I made two deposits!?!?! Two transactions, two individual events, two and online it shows my single transactions.
It comes down to what is the definition of a transaction is. The lady on the phone explained it as she read something, which if the rest of the website and paperwork was worded like she claimed it was I would understand it, however online and my paperwork said something a little different.
Here’s the explanation from WellsFargo.com and a PDF from July 2019 for Small Business Account Fee Schedules, which is not what the phone rep. read to me –
Refers to any combination of deposits, paid items, and deposited items, including paper and electronic transactions. Transactions do not include purchases and payments made using a Wells Fargo Business Debit Card or Wells Fargo ATM Card, Business Bill Pay, or Direct Pay payments made through Wells Fargo Business Online®, and Wells Fargo Merchant Services, or Wells Fargo Business Payroll Services transactions.
After it was explained and as I re-read above, I can see the two words that explain the situation. But if you don’t have it specifically explained you probably think a deposit is a deposit. NOPE!
Those two words are – ‘deposited items’.
Where my 50 transaction came from wasn’t that I made 50 trips or separate deposits at different times, but my deposit had 50+ checks in one deposit.
Wells Fargo counted each check I submitted as a single, separate transaction and counts it against your limits, even though I put them in at the same time.
In my mind, from decades of financial, professional, corporate, IT… transaction is a single event. The payload within is part of the one transaction.
I am surprised they didn’t break down the single bills from the cash deposit too. (Better stay quiet, I might give them a new revenue stream idea…)
Are you clear?
OK, so we change the strategy and off balance it with cash instead. Ahhhh, hold on right there. The account allows you to deposit $3,000 “free” then it’s $0.50 per $100 above that after.
What about changing to a higher level Business Account to have a higher limit. Sure, but as a small business as a non-profit the money we get in goes right out to fees we are raising money for. We won’t and can’t carry a high enough balance to not avoid those balance fees, but we will be able to deposit 100 checks ‘free’.
Right now we’re stuck. We paid for checks on the account, paid those transaction fees already (which they didn’t waive) and too far along to find another bank or credit union that would not nickle, dime, penny, quarter you in to oblivion. Over the life time of this account’s existence we are now going to have to take into account hundreds of dollars of ‘fees’ off our deposits, we can’t help it. Fundraising around the community will be mostly checks, especially from other businesses and organizations for tax purposes. That’s the whole point of the Tax ID status. We will have hundreds of checks coming in and those will have to be dealt with… and Wells Fargo will get their fee from them.
I can assure you future business with Wells Fargo will not happen or anyone else with that level of ‘fees’ on every end so customers cannot avoid them.
Read the fine print but also an interpreter to figure out what the company meant by it.
As Bill Clinton once said in response to an interrogation question, “It depends on what your definition of Is, is.”
End of line.
Binary Blogger has spent 20 years in the Information Security space currently providing security solutions and evangelism to clients. From early web application programming, system administration, senior management to enterprise consulting I provide practical security analysis and solutions to help companies and individuals figure out HOW to be secure every day.
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