Wells Fargo Confusing Account Terms May Cost Customers Extra Fees, Lawmaker Says – According to Democratic House Representative Katie Porter, Wells Fargo may have collected “hundreds of millions of dollars” in account fees from customers, because the bank presents confusing rules about the terms of its accounts.
Representative Porter is a member of the Financial Services Committee who recently sent a note to Charles W. Scharf, CEO and President of Wells Fargo, to this effect.
She requested that the bank provide details about this confusion, and the financial effects that the confusion has on Wells Fargo customers.
Rep. Porter claims that Wells Fargo knowingly provides “incomplete information over a span of multiple years” concerning its Everyday Checking and Opportunity Checking accounts. Reportedly, both accounts charge customers a monthly fee of $10 unless the customer fulfills at least one of several requirements.
The representative states that one of the requirements that customers can meet to avoid the $10 fee is to make a minimum of 10 transactions per month. Allegedly, ATM withdrawals do not count towards these 10 transactions.
Many customers reportedly believed that ATM transactions did count towards the 10 transactions, and were hit with unexpected fees, if they had thought they were making enough transactions, but were not.
Last month, Wells Fargo acknowledged the problem in a filing with the Securities and Exchange Commission, noting that it was reviewing “certain past disclosures to customers regarding the minimum qualifying debit card usage for customers to receive a waiver of monthly service fees on certain consumer deposit accounts.”
In that filing, the bank noted that it expected to refund some of the fees collected. However, Rep. Porter requested more information in her letter to the bank, as Wells Fargo did not specify how many customers had been affected, or how many fees the bank would likely refund.
This issue of Wells Fargo bank fees comes amidst a rise in bank fees across the financial industry, says the Washington Post.
Reportedly, Bankrate says the average cost of an overdraft fee has risen from $21.57 in 1998 to $33.26 this last year. The fees associated with savings accounts and using ATMs from other financial institutions are also reportedly on the rise.
According to the Woodstock Institute’s Senior Vice President of Policy and Communication, Brent Adams, these fees have a significant impact on consumers. He says that the fees “have the effect of pushing more people out of the banking system,” and are often disclosed in a way that is confusing and easy to miss.
The issue of confusing fee disclosures is not the only scandal regarding Wells Fargo that has made the news. In 2016, it was revealed that many of Wells Fargo’s employees had been opening fake bank accounts for customers who did not request them, or had been upgrading accounts without consumers’ consent. This was reportedly an attempt to meet lofty sales goals.
News sources estimate that around 3.5 million accounts were opened as a part of this scam. To make matters worse, some customers reportedly incurred fees and interest charges in connection with these fake accounts.
Have you been charged unexpected banking fees from Wells Fargo or another financial institution? Let us know in the comments below.