Wells Fargo Wouldn't Accept My Deposit – So Where Is It Now?

Adrienne tells Consumerist that she did something very mundane: she deposited a payroll check that her fiancé had signed over to her in her Wells Fargo bank account using an ATM. Based on previous experience, and assuming that a payroll check from a Fortune 1000 company is a straightforward enough deposit, she then paid bills using the money that she thought was in her account.

First came bounced checks and the fees that come with them, then a flurry of contradictory information from Wells Fargo, and finally Adrienne learned that her deposit had been reversed and mailed back to her, because she needed to present it to a teller in person. She’d be happy to do that, but at the time she wrote to Consumerist, the check hadn’t showed up in her mailbox yet and her account remained overdrawn.

On September 3rd my fiancé signed his paycheck over to me for deposit. I then deposited this check into the Wells Fargo ATM. The check had been indorsed to me, and both of our signatures were on the back in the appropriate place. We had done this before with other checks that were made out to him, and never had a problem.

We then proceeded to pay a few bills with the available money, including a few ATM withdrawals, and wrote a check for a portion of our rent.

On September 9th I checked my balance online and saw that it was negative by over $400, and that the deposit had been reversed. I called Wells Fargo and I was told that everything would be covered while they figured out what happened. I told them I had a $300 check outstanding, and I was informed that it would be covered,

The next day (09/10/10) we received a letter dated 09/07/10. The letter stated that only half of the funds from the deposit made on 9/03/10 would be available for immediate use, and that the remaining funds would be available 09/08/10. I checked my online statement again, and the check bounced that day. The day AFTER I was told via letter the funds would be available, and after I was told it would be covered.

I called Wells Fargo a second time, and was told they had mailed the deposit back to me earlier in the week, and that I would have to deposit it in the branch itself with a teller. They said they could not verify the deposit, which is funny, since it’s an ADP payroll check from a Fortune 1000 company.

As of today 09/17/10, I still have not received the payroll check in the mail to re-deposit. The branch and ATM I used originally is 1.5 miles from my house, so this delay is worrying. My Wells Fargo checking account is still negative by over $450, including the returned check fee they charged – even though they said the check would be covered. I had to pay $110 in late fees and charges to as a result of that bounced rent check. In fact, I was called 4 times yesterday at work by their collections department to tell me that I had a negative balance! I can’t tell if this is merely incompetence or if they are just trying to find any excuse to charge me more fees by allowing me to use funds, then taking them away and charging me for the pleasure.

Our contact information on file for Wells Fargo executives is a few years old and may be out of date, but we hear that WF responds well to executive e-mail carpet bombs.

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  1. einstoch says:

    Having worked for a large bank, I can tell you right now that unless both signers of the check are on the account that the check is being deposited into, we cannot deposit the check for you. Double endorsed checks are too difficult to verify unless it’s in person. It’s too much of a liability. We can however look up the person it was made out to if they have had an account with us to verify the signature.

    • dragonvpm says:

      So is losing the check and saying one thing and doing another also SOP for a large bank?

      Regardless of what concerns they might have had about the check, if the bank lost it then it should honor the deposit and rescind any overdraft fees etc… until it finds it and the OP can take whatever steps are necessary for resolving the issue.

      While a double endorsed check may be a pain for the bank in general, if you look at the big picture the bank is the one that screwed up this entire situation. Presumably if they don’t want to honor a double endorsed check it’s because they are concerned with fraud, wouldn’t it make sense to ask for both people to come in to the bank to verify their IDs as a first step instead of shipping back evidence of potential fraud back to the person who tried to deposit it in the first place?

      • einstoch says:

        Wells Fargo has automated deposit ATMs. This means that it scans the check that is inserted into the machine and makes the deposit. The machine cannot tell whether both parties that signed the check are on the account. What must have happened is that someone (human) caught the check after it was deposited and reversed the transaction.

        As for what happened to the actual check, it should have been returned to her, that is a mistake on the part of Wells Fargo.

        • dragonvpm says:

          It seems like the bank should take steps to verify the check (i.e. ask both parties to come in and show them some ID) before denying it outright (especially if there isn’t any history of this sort of issue with the account in question). Returning a check that they are concerned might be “fraudulent” (as you note in the previous comment) seems like the wrong thing to do. Losing the check makes me think that they should credit the amount of the check to the account while they sort out THEIR mistake and if the check never turns up then that’s their problem.

          Also, If they’re going to have ATMs that accept checks for desposits this exception seems like something that should be noted at the ATM (i.e. “Checks not made out to someone on the account must be desposited in person”). In this case it sounds like they don’t even have a digital scan of the front and back of the check which seems highly suspect (otherwise they could take steps to resolve this problem even if the original check was lost)

          • chocolate1234 says:

            When I worked at a bank, we had to send ATM checks to a central office in a different part of the state, even if we were going to return the check. It was kind of ridiculous, but I suspect WF may have the same procedure. So, they likely haven’t lost the check, but it has to hit five different departments before it’s returned to the customer. I’m not saying it’s logical or okay, but it’s probably not lost and she will get it back.

    • mdoneil says:

      That is complete nonsense. The UCC is controlling, and a negotiable instrument may be made payable to serial parties, the ultimate presenter guaranteeing the endorsements of the previous.

      If a check made payable to A is endorded to B and then B endorses it to C; C may encash the instrument as C sees fit. The bank has a duty to act according to the law, and unless there is specific reason for returning the deposit such as NSF or account closed, they must process the deposit absent any indication that it may be fraudulent. Simply being a multiparty check is not evidence of fraud.

      • einstoch says:

        A private bank has no obligation to accept any form of negotiable instruments that it believes may be fraudulent, just the same as I have the right to refuse a counterfeit check. Especially in regards to dual signature. Unless we have both signatures on file, we will NOT accept it and the check will be returned, and I have personally returned such checks.

        By your logic, I can steal my neighbor’s signed paycheck, sign my own name counter-it, and then sell the check to some bum for half the price as long as everyone signed it.

        • Jesse says:

          Yes, technically you could. That’s why you never openly endorse a check. But on the other side, if your neighbor’s check bounces, you are responsible for the full amount.

          Not all third party endorsements are fraudulent. Unfortunately, many banks (e.g., my credit union) treat them as though they are and make people jump through hoops (e.g., have the original party show up to show ID). I don’t see a problem with accepting a third party check as long as there are sufficient funds to cover the deposit in case the check bounces.

        • Putaro says:

          I always write “FOR DEPOSIT ONLY” below my signature when I endorse a check. Not sure if it actually means anything but I was always told this is the way you do it so no one can endorse it again to themselves.

      • KnowledgeIsPower says:

        “The bank has a duty to act according to the law, and unless there is specific reason for returning the deposit such as NSF or account closed, they must process the deposit absent any indication that it may be fraudulent. Simply being a multiparty check is not evidence of fraud. “

        Not quite. It’s clear you’ve heard of Article 3, but don’t have enough experience with financial institutions to understand how it’s applied.

        Just because the bank ATM takes your check doesn’t mean that the bank has “accepted” it! Your account agreement terms govern this. Then go see § 3-501(b)(3) (“…the party to whom presentment is made may … refuse payment or acceptance for failure of the presentment to comply with the terms of the instrument, an *agreement of the parties*, or other applicable law or rule.”)

    • sleze69 says:

      Having worked for a midsize bank, I call bullshit. We were trained to deposit them flagged as “out of state” thus resulting in a 1 week hold. I deposit checks to my wife, endorsed to me into my own account all the time. Mostly I do it through ATMs.

      I have never had a problem.

    • chocolate1234 says:

      We had the same rules at the bank where I used to work, and mine was a mid-size bank, so I’m backing you up on this.

    • strawbabies says:

      When I had my account with a large bank, my fiance endorsed a check to me. We both went into my bank’s branch, and they accepted it, as long as I already had the funds in my account to cover it if the check was returned. My fiance was not on my bank account.

  2. qbubbles says:

    … I’m not gonna blame the OP. Really, I’m not. See? Watch me not blaming her.

  3. DorianDanger says:

    wow fortune 1000, the list seems like 2x as long as I remember nowadays.

  4. zeiman says:

    Question for the OP, did you wait to see if the check cleared before writing checks and using the ATM, or did you simply assume that the check would clear. Always, always, wait for a check to clear the bank before issuing checks against that money.

    On the otherhand, if the check did clear after the two-day period, and then was reversed, you have a ligitiment gripe against Wells Fargo.

    Either way, the lesson to take from this is to always use the teller for less than straight-forward transactions.

    • shufflemoomin says:

      I have to blame the OP a little here. You’re responsible for failures that happen based on assumptions you make. Never assume a check will clear and certainly don’t spend the money before finding out.

      • Promethean Sky says:

        Hate to agree with a bank on anything, but I am in agreement here. It is sorta the OP’s fault. True, the system worked before, but if you do anything chancy enough times, it’s going to bite you in the butt eventually.

        That said, the bank should have told her about the difficulties with double endorsed checks beforehand.

    • njack says:

      It is always good practice to make sure a check clears before drawing funds on it, but it sounds like the OP and her fiance are living paycheck to paycheck. This was his payroll check from a presumably financially healthy company and they needed to pay rent. My point is the OP may not have had a choice than to draw funds against their account when they assumed there would not be an issue.

      The problem with that is making assumptions will always lead to trouble. The OP should have obviously went to a teller to deposit the check and probably needed to take her fiance with her, otherwise they would have issues verifying no fraud anyway. This looks to be an expensive lesson learned.

    • KyBash says:

      It said the bank reversed the deposit, so if she checked her balance before the bank took action, the transaction would have shown up as if nothing was wrong and she had the money available.

      I’ve had the same thing happen. I checked my balance one day and it said over $2600, and the next day, without my spending any money, the balance was $87 because the bank decided to put a hold on a deposit after they’d already credited it.

    • omg says:

      I’ve never had problems with a check from a Fortune 1000 company not clearing, so I didn’t expect it to not clear.

  5. y2julio says:

    So wrote checks based on funds that weren’t deposited yet?

  6. mythago says:

    Interesting how many folks are ignoring WF’s statements about covering the check.

    • AK47 - Now with longer screen name! says:

      This is Consumerist. We’re conditioned to believe that any statement made by a CSR (especially at a bank) is a damn dirty lie.

  7. carlathecommander says:

    I’m surprised they accepted ATM deposits without him on the account previously. I’ve never known a bank or credit union who would do that. I could take anyones check and deposit it into my account.

  8. framitz says:

    Unfortunately this sounds like ‘user error’.

    • dragonvpm says:

      The bank lost the check which now makes it exponentially more difficult to resolve the issue. So this goes beyond user error.

  9. drburk says:

    Why didn’t it clear? They must have a reason for denying the deposit.
    In my business I deal with 4 party checks (husband, wife, mortgage company) they sign over to me. I write deposit only and put it in my bank no problems. Some companies don’t get all the endorsements and use a check scanner to electronically deposit them.
    You have to take the check to a teller because a returned check cannot be deposited using a scanner, ATM, or iPhone app, they will see it as a duplicate deposit and reject it again.

    Best bet go to the bank you opened your account at and talk to the manager. I always find it best to start by saying, “I need to close my account because of…”

    • qbubbles says:

      Cant close your account when you’re overdrawn $400… unless you have $400.

      • qbubbles says:

        Good frickin god. Bad Consumerist server, bad!

      • Conformist138 says:

        Oh yes you can. You still owe them money and can get collections after you, but you can order the account closed. When I was a teenager (before I knew much of anything about banking or managing money) I had an account that I stopped using without officially closing. Monthly fees eventually ate the remaining $10 or so and overdrew the account. The bank then CLOSED the account, but it was still listed that I owed about $3 and change. I didn’t even know about it until I went to that bank again more recently to see about opening a checking account with them.

    • qbubbles says:

      Cant close your account when you’re overdrawn $400… unless you have $400.

    • qbubbles says:

      Cant close your account when you’re overdrawn $400… unless you have $400.

  10. DanKelley98 says:

    The banking industry is as bad as the airline industry. Anti-consumer. Why in god’s name would they communicate by LETTER? Aren’t their customers worthy of a phone call in situations like this? Doesn’t some employee at this bank HAVE A CLUE as to what rejecting a deposit might do to a CUSTOMER? How would a CUSTOMER even know this policy? Either the check is going to clear or it won’t. Case closed.

  11. 24gotham says:

    Signed over the check?
    They still allow this? Really?
    I am sorry…. I just can’t feel bad for the OP. It should be obvious that if you are depositing a check that was signed over to you in an ATM this would be a giant red flag to the bank. Also, regardless of where it came from, you cannot rely on a check being credited the same day you deposit it, so writing other checks and withdrawing from the account before confirming that the funds are in the account is a rather foolish thing to do.

    • MauriceCallidice says:

      Yes, “they” still allow this. It’s entirely legitimate and perfectly normal.

      Some of the posters here make it sound like a serially-endorsed check is prima facie evidence of fraud, when it’s a long-accepted and entirely legally-sound practice.

    • Sasha_Pie says:

      My fiance is not on any of my accounts and I deposit checks that he has endorsed at least a dozen times a year through my local BofA ATM and I’ve never had a single problem.

      For once BofA isn’t the worst at something! It’s like seeing Halley’s Comet…

  12. There's room to move as a fry cook says:

    At Chase – check funds are not available until the next business day – and weekends are screwy. Sept 3rd was the Friday of a long weekend. If I don’t get check into Chase by 3pm Friday then the funds won’t be available until Tuesday morning – or Wednesday morning on along weekend.

  13. greggen says:

    This happened two years ago at WF. I deposited a payroll check made out to my wife (who was not on the account) and she endorsed it to me. Deposited into ATM. A week later the funds were removeddeposit reversed. Had the same fun of different answers from different employees at WF. Got the check back 21 days later. Long story short, they refused to accept the check because they did not have wife’s signature on file. Would not unless she was on account. Did not lose any money to fees or bounced checks, just had the frustration of loss of money for 3 weeks.

  14. Arimer says:

    I didn’t go through this but something similar. Deposited my payroll check into the atm. It says it can’t read it and tries tto spit it back out. Machine jams and keeps my check. I go inside the bank and no one can open it until the collection truck comes around. They advise me to have my work do a stop payment and get a new check. I do that and deposit the new check no problem minus the stop payment fee i had to reimburse my workplace for. So a month and a half later I get a call asking if I still want to deposit this check. I say no, shred it because its no good anymore. Later that week I check my account and they have deposited it. I call and they say it will be fixed promptly. 7 weeks later its finally removed along with a returned check fee. The bank will not reimburse the fee which they claim was my fault for not informing them of the stop. I closed my account at that moment and went to a credit union.

    • Jeff-er-ee says:

      Was about to do the old, “Why are you STILL at a large institution???” when I read the last line. Good on you :-D

  15. Suburban Idiot says:

    Similar thing happened to me at Washington Mutual several years ago. They claimed they mailed the check to me, but I waited and waited and waited, and it didn’t show up. Thankfully, the check was only for $125 or so refund from the State for an overpayment, so it wasn’t as big of an inconvenience (it was like “found money”, so I wasn’t relying on it for bills or anything, and its absence didn’t cause any overdrafts).

    It was nearly six months later that the check showed up in my mailbox, with a postmark from only two or three days prior. I have no idea where the check actually was during all that time.

  16. shopSmart says:

    I don’t even understand why we’re having this discussion. 1 obvious equation – Wells Fargo = fail.
    You should expect nothing less from a large, faceless bank.
    Unfortunately your parents probably didn’t warn you about them and now your learning a difficult lesson. Take it in stride, as many of us have before you, and move on to a smaller, friendlier institution.

  17. bosozoku says:

    The consumer’s story is full of a lot of holes, not to mention the word ‘indorsed’.

    This is a risk consumers take when you accept a check for deposit (no matter if it’s from a Fortune 1000 company or Bob down the street), the only way to verify if an item has been paid is to contact the financial institution the check was drawn on.

    Get with the times, set up Direct Deposit, and don’t overspend.

    I wanted to comment on 3rd Party checks too:

    What the heck were you doing depositing a 3rd Party Check in an ATM? What makes someone think that it is even acceptable?
    I could list a lot of reasons, but the most obvious is who’s going to check the signature of the party that signed the check over to you?
    If this was allowed, what’s to stop everyone from stealing other people’s checks and depositing them into their own account by ‘signing them over’.

    As far as where your check is, ATM EO (based out of Phoenix, AZ I believe) will send the item back to your address on file and usually takes 5 business days depending on USPS shipping times.
    If you do not receive it within 5 business days, call Wells Fargo, order a photocopy or print one online, this will be legal tender per the Check 21 Law.

  18. invisibelle says:

    While of course it should be allowed to endorse checks to a 3rd party… I don’t think I would’ve tried for ATM in this case. Sucks mucho if they lost the check, though.