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I’m Sierra. I live in the Boston area with my family.

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Wainwright Bank Stole My Lunch Money

by Sierra on December 2, 2009 · 25 comments

in money

Dear Wainwright Bank,

You appear to have stolen my grocery money.

I was surprised and alarmed to see, when I checked my bank balance this morning, that I had been charged $92.97 in overdraft fees. My statement clearly shows that no overdraft took place.

I showed my bank statements to a manager at your Davis Sq branch and asked her to explain what had happened. Her explanation was long and convoluted. Ultimately she gave me to understand that:

  • my bank statement is not an accurate reflection of the transactions on my account
  • you don’t process any transactions from the weekend until Monday
  • which I knew, and was sort of counting on when I raced to the bank Monday morning to deposit my paycheck
  • which cleared on Monday, according to your records, before any of the debits were processed
  • but you charged me an entire week’s grocery money in overdraft fees anyway
  • for one overdrawn check and – I love this – two ATM withdrawals made on Saturday.

This last part is really the kicker. On Saturday, there was over $500 in my bank account. My husband took out $20 to buy groceries and later $10 to pay for parking and tolls to get his son to the airport. Leaving, let’s be clear, over $500 in our account.

On Sunday evening, my student loan payment posted. That payment, along with a transfer scheduled for Monday, would have overdrafted my account. Which I knew. See also: so I raced to the bank on Monday morning to deposit the check I received in Saturday’s mail.

Yes, I was cutting this pretty close. A Real Grown-up would keep a bigger cash buffer in her checking account, and always balance her checkbook perfectly. Fail. I thought I might get dinged one overdraft fee for depositing the check on the same business day you were processing my loan payment.

But charging me an additional $64 in overdrafts for taking CASH out of my account? When there was money in it?

I had to ask the bank manager twice if that really happened. When she assured me it was bank policy, I had some stern words for her.

They started with, “How can you sleep at night?” and ended with, “This company makes me sick.”

Here is the gist of what I said between those sentiments:

I want to know how you as an organization dare to present yourselves as a community bank invested in social justice. This draconian banking practice perpetuates cycles of poverty for your most vulnerable customers.

For me, this was a rare bad break. It’s also a problem easily solved: I just took my business down the street to Citizen’s Bank. They offered me an overdraft line of credit with no fees (only paying interest on overdrafts), a better savings rate, and an incentive program for using “green banking” features like paperless statements and online bill pay. On top of that, they’re giving me a $100 bonus for opening an account with them. So I’ll be getting my grocery money back – from your competitor.

For people with less stellar credit or reliable income, however, your practice can be ruinous, trapping them in a cycle of debt they can’t get ahead of. That’s why  new regulations make it illegal. Those regulations haven’t taken effect yet, but I would have hoped a “progressive” bank would be ahead of the curve on Not Fucking Over Its Poorest Customers.

Let’s talk a bit about your malicious accounting process, shall we? It’s no accident that you processed my transactions the way you did – debits before credits, with the largest debit deducted first even though it came in last. As one of my colleagues at Wise Bread reported last week, banks use this shifty accounting to screw customers for excessive fees. It’s not just me being irresponsible once in awhile; it’s a system designed to rob people exactly at the moment their finances are least resilient. You’re making a killing on this. Overall, banks are expected to make over $38 billion on overdraft fees this year.

Again, this practice targets the weakest links in your system. You like to advertise yourself as helping the poor in the communities you “serve”, but even most big conglomerates have clued in and are starting to scale back their overdraft rackets. You’re not an alternative to the big bad banks. You are the bad guys.

It is a genuinely sad thing for me to finally sever this relationship. I’ve stuck by you for nearly a decade, feeling a loyalty to your stated mission that led me to excuse your high fees and poor communication skills. I really want my money to be handled by a bank that cares deeply about the community it does business in. A bank that puts social justice, human values and environmental stewardship on par with profit motive.

Sadly, you are not presently that bank. You’re a wolf in progressive clothing, preying on the neighborhoods you pretend to serve. I hope you will look seriously at reforming these practices and become the bank you pretend to be.

In the meantime, I look forward to doing business with Citizen’s, where I expect that my family and my money will be treated with respect.

No love,

Me

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  • http://twitter.com/trailofbrdcrmbs Emily Powers

    Thanks for this post- I was planning to switch my business to Wainwright because I was attracted by their ads touting progressive values. After reading this I no longer wish to.

    [Reply]

  • RosaLC

    This is appalling. I'm a Wainwright customer and this makes me want to switch. :(

    [Reply]

  • Rowan

    If you really want to get even with them, post a bad Yelp review: http://www.yelp.com/biz/wainwright-bank-and-tru

    [Reply]

  • http://www.leahbloom.com/ Leah Bloom

    It sounds like you're happy with your decision about a new bank, but I will take this opportunity to pimp what I believe to be a true community bank, Florence Savings Bank in Florence, MA. I opened an account with them when I moved out to Northampton in 2001, and though I moved back to Boston (and away from all of their physical branches) in 2002, I've kept my account there and been gleefully happy about it.

    I get free checking and savings, excellent interest on my checking account and refunds of all ATM fees (provided I make 12 transactions with my debit card a month, which, since I don't live near any of their ATMs, is simple because I always need cash back wherever I shop), and the best customer service ever.

    I can *always* talk to a human on the first try, and they've never failed to treat me politely and professionally, and to answer all my questions and handle all my issues quickly and with excellence. The people there recognize you when you walk in, and the woman who opened my account (actually, both women, both accounts) sent me a hand-written thank you note to mark the occasion. They are also very involved in the community.

    I like them so much that when I started my business, I drove out to Northampton to open my business account with them too. I only wish I lived in their range, because I'd like to have my mortgage with them, too.

    [Reply]

  • drwex

    Yow. That is serious suck. I'm sorry you got hit that bad. We've been with Citizens for several years and they've generally been reasonable

    [Reply]

  • http://aseasontotaste.wordpress.com/ Sarah

    As you've noted, this is an unfortunately common practice, and one I've also been personally hit by. Ugh! I'm sorry it happened to you too.

    ING is another bank that offers a no-fee overdraft line of credit, and that's ultimately where my business has primarily ended up.

    [Reply]

  • http://ceo.livejournal.com/ ceo

    Wow. I've never actually cared for Wainwright, having heard some unfortunate things about their business account policies, but that's a pretty glaring disconnect between their stated values and their actual practices.

    You've already switched banks, but I'm dearly fond of my credit union, even though they don't have any branches anywhere near me. We also have accounts at Cambridge Trust and like them too.

    I second the recommendation to post a version of this on Yelp.

    [Reply]

  • DoctorMemory

    In the immortal words of Bob the Angry Flower: that's some seriously advanced bullshit right there.

    [Reply]

  • http://childwild.com Sierra

    done. I posted it to the Davis Sq LJ community too.

    [Reply]

  • http://childwild.com Sierra

    That sounds awesome. I love hearing about good banks. I think I'll make “banks that don't suck” the topic of my next Wise Bread post.

    One of the key things I need in a local bank is that they be extremely local. I have small checks and/or cash to deposit a couple of times a week because of the way I get paid. I don't feel comfortable mailing cash deposits, so I really need a bank that's within a 15 minute walk of my house that I can go to in the middle of the afternoon any day of the week.

    That's also why I didn't opt for any of the credit unions we could join: none of them have branches within easy walking distance of my house. I do use ING for my savings, and they're also excellent in terms of not charging fees and having great customer service. But they have no branches. :(

    [Reply]

  • http://childwild.com Sierra

    I use them for my savings, and might use them for my bill pay going forward. But as I said above to Leah, I need to be able to walk over to the bank and make deposits two or three times a week. ING can't do that for me.

    [Reply]

  • Ellen

    Much as I love Citizens on almost other issues, I'm not sure what makes you think they're any better than Wainwright on this one. Citizens hit us with over three hundred bucks in overdraft fees last month under similar circumstances :(

    [Reply]

  • http://openid-provider.appspot.com/brian.olson Brian Olson

    See also the recent Frontline Episode, “Card Game”
    Hear a banker tell how customers really want to get screwed with biggest-debit-first accounting reordering!

    [Reply]

  • Rich Wilson

    And how they force you to have a debit card overdraft with no warning, so if you'd rather just have the transaction declined if you're out of funds, you don't get the option.

    [Reply]

  • http://childwild.com Sierra

    Rich, I'm pretty sure that last one is on its way out with those new regulations I referenced above.

    [Reply]

  • pekmez

    I have no direct experience with them, but I am curious what makes you think that Citizens isn't doing exactly the same accounting tricks? They won't hose *you* because they offer the overdraft protection in a free package deal – but that doesn't make it right to reorder the transactions so that they hose other people, and I'm sure that for customers without overdraft protection their fees and rules are just as oppressive.

    I can somewhat understand them reordering to say “no, you can't float money into the account the second the bank opens on Monday to cover the withdrawals that are waiting in the queue to process on Monday” but the weekend ATM withdrawal fees seem ridiculous.

    (For your requirements I would probably have tried to go with Cambridge Savings Bank, which has a branch right in the Porter Square Shaw's shopping center. Again, I don't have personal experience with their policies, and actually I only bank with them by owing them money, not by storing it with them. (They own our mortgage.) And soon I will sacrifice that too because while I like to put my money where my values are, $5000+ now (what it would cost to refinance my mortgage with them rather than the broker who originally handled our loan) and/or a worse mortgage rate is a bit over the line. ;-)

    But I like their customer service. If I hadn't been banking with Cambridge Trust Company for a million years, I would probably be using CSB for more banking.

    [Reply]

  • Christopher White

    I have news for you. Citizens Bank has the worst overdraft policies in the country, according to their own literature.
    http://docs.google.com/viewer?url=http://admin….

    [Reply]

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  • Jenn H

    If you are really looking for an awesome bank w/ that convenience factor I would try USAA. I'm so in love with them my husband is worried about his place in my heart! They don't have branches but you can deposit your checks from YOUR HOUSE using a scanner. It totally rocks. Check it out.
    https://www.usaa.com/inet/ent_logon/Logon?redir

    [Reply]

  • Jenn H

    If you are really looking for an awesome bank w/ that convenience factor I would try USAA. I'm so in love with them my husband is worried about his place in my heart! They don't have branches but you can deposit your checks from YOUR HOUSE using a scanner. It totally rocks. Check it out.
    https://www.usaa.com/inet/ent_logon/Logon?redir

    [Reply]

  • Jenn

    As a former employee of Citizens Bank, I can tell you that they process transactions the same way – largest debits first, and debits before credits. I now work for a mutual bank, as in we don't report quarterly earnings to shareholders. If you're looking for a community bank, you need to find a mutual or cooperative bank. Only then will you find fair banking practices.

    [Reply]

  • http://childwild.com Sierra

    Thanks for the tip!

    [Reply]

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  • http://nothingnewgirl.blogspot.com/ Loren

    I've never read your blog before I linked over from a post on the 'Get Rich Slowly' blog. But a few years ago I had a bank (National City, a local company that got bought out) do the EXACT same thing to me.
    It was a checking account my roommate and I used PURELY to pay utility bills. So there was never much more than 100$ in it to begin with.
    But I MAILED a water bill on Saturday morning (as in dropped it off at the post office so that it would arrive in 3-5 buisness days.)
    I went to work, then stopped at the ATM outside my bank on my way home, I DEPOSITED the money into the checking account (on a Saturday night less than 12 hours later).
    3 weeks later, I get a notification in the mail that my bank account has been over drafted for 3 weeks. And that if I don't fix it immediately they will take MORE money out.
    Why was it over drafted? Because the BILL that I mailed got processed Monday MORNING, but the money that I deposited, didn't get processed until Monday at FIVE O'CLOCK. The bank HAD the money for the deposit since Saturday at about 10 pm, but still processed it LAST, even though the BILL couldn't possibly have been received until 8 am Monday morning because the water company isn't OPEN on the weekend. Then they didn't notify me of the problem for 3 WEEKS, right before they were going to begin CHARGING me for having an over drafted account!

    Now I do all my banking with a non-profit credit union. And if I deposit a check in an ATM, it gets processed by the time I get home and check my balance online.

    [Reply]

  • http://nothingnewgirl.blogspot.com/ Loren

    I've never read your blog before I linked over from a post on the 'Get Rich Slowly' blog. But a few years ago I had a bank (National City, a local company that got bought out) do the EXACT same thing to me.
    It was a checking account my roommate and I used PURELY to pay utility bills. So there was never much more than 100$ in it to begin with.
    But I MAILED a water bill on Saturday morning (as in dropped it off at the post office so that it would arrive in 3-5 buisness days.)
    I went to work, then stopped at the ATM outside my bank on my way home, I DEPOSITED the money into the checking account (on a Saturday night less than 12 hours later).
    3 weeks later, I get a notification in the mail that my bank account has been over drafted for 3 weeks. And that if I don't fix it immediately they will take MORE money out.
    Why was it over drafted? Because the BILL that I mailed got processed Monday MORNING, but the money that I deposited, didn't get processed until Monday at FIVE O'CLOCK. The bank HAD the money for the deposit since Saturday at about 10 pm, but still processed it LAST, even though the BILL couldn't possibly have been received until 8 am Monday morning because the water company isn't OPEN on the weekend. Then they didn't notify me of the problem for 3 WEEKS, right before they were going to begin CHARGING me for having an over drafted account!

    Now I do all my banking with a non-profit credit union. And if I deposit a check in an ATM, it gets processed by the time I get home and check my balance online.

    [Reply]

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