Wachovia's "Way2Save" Account Triggers Over $5,000 In Penalty Fees

Wachovia has a new financial product called Way2Save that automatically moves $1 from your checking account into a high interest personal savings account every time you make an electronic bill payment. Susan tried to maximize her contributions by making a lot of little bill payments, but Wachovia cut off access to her funds without notice and triggered an avalanche of penalty fees. Now she owes over $5,000 to her credit card companies, far more than she would likely have ever earned through Wachovia’s complicated savings program, and of course Wachovia is denying any responsibility.

I signed up for Wachovia’s Way2Save program, which gives you 5% interest on your savings the first year. You can only deposit $100 a month into the account. The only other way to put money in is by account activity (paying bills, etc). So I scheduled a lot of $1 bill payments to my credit cards every day to try to get as much money in the savings account as possible.

Wachovia put a temporary hold on my checking account without telling me. There was no phone call, email, or online notification. So imagine my horror when I got emails from their billpay service saying they couldn’t withdraw the money from my checking account and were reversing the bill payments. I had deposited several hundreds in cash (in person) into the checking account, so I knew it couldn’t be because the funds hadn’t cleared. And the bill payments totaled only around $200 anyway.

When I called, it turns out that Wachovia had put a temporary hold on my checking account, freezing the funds. No one was able to explain why, but they said the hold was gone. They weren’t able to stop the payments from reversing.

The end result? My credit cards are charging me over $5000 in reversed payment fees (150 reversed payments * $39 average per returned payment, you do the math). In particular, Chase has canceled all my cards because of the multiple returned payments. I called my Chase small business card account, and the specialist at Chase said they could not do anything, or even waive *some* of the returned payment charges, unless I could get Wachovia to send a letter saying the returned payments were the result of bank error.

I called Wachovia, and they refused to do anything. Their stance is that it was not a bank error because I scheduled the bill payments, not them. There were no notes on my account (because I had talked to someone in bill pay, which apparently is a contracted out service, not part of their own system). They had no record of any hold on the account, and even if there was a hold, it wasn’t their responsibility because I had scheduled the bill payments myself. They also mentioned deposit availability, though I pointed out that I had deposited cash. I’m going into a branch on Friday, but I don’t think they will write anything for me either.

I haven’t called the other credit cards yet. I’m dreading calling my other credit cards to see if they will waive anything. So in the end, I am stuck with this fiasco. At least Christopher’s problem was caused by the same bank charging him the fees. They have the power to waive the fees. What happens when the problem is caused by a different bank, and that bank won’t help at all, not even write a stupid letter?

I hate Wachovia. I don’t have problems with it if the problems were caused by my scheduling bill payments, and there wasn’t money in the checking account. I do have problems when the checking account says I have several hundred dollars available, I had deposited more than enough cash to cover the bills the previous week, and there is NO notification that a temporary hold had been put on the funds. How is that my fault and not the bank’s???

Do you have any EEOB-type email addresses I could possibly use to write to the service departments at Chase, Bank of America, Discover, Amex, and Citibank?

Or any advice on how to handle the situation? Ways I can convince Wachovia to write the freakin’ letter? Or am I stuck sucking it up?

The wildest thing about this is the idea that Wachovia would have no record of the minute-to-minute status of your accounts, including your deposits and when funds became available. You should go into a Wachovia and have a nice long sit-down with someone there, where you both go over the account item by item if necessary, until they have to admit that there is not a single reason those payments should have been reversed. After all, if they don’t have a reason for—or even a record of—placing the hold, it should be easy to determine that you always had the funds necessary to cover your payments.

For now, keep this with Wachovia. It’s on them to correct their mistake, and to provide you the necessary evidence you need to get your other creditors to reverse the charges and re-open those accounts. Unfortunately our Wachovia contact info is getting pretty dated (although now there’s a Twitter contact), but maybe you can get somewhere if you EECB Wells Fargo. (Tell them you’re a dirty telemarketer who wants to rip off old people and they should prick up their ears.)

For other Wachovia customers, you might want to find a less dangerous way to save your money. Tying it to bill payments is pretty risky, and you don’t have to have an exceptional case like Susan’s to wipe out your gains—a single error, whether by you or Wachovia, could easily do it.

(Photo: suburbandollar)