Should I leave Wells Fargo after the scandal?
Q. After this Wells Fargo scandal, I’m thinking of moving my accounts and my mortgage. Should I?
A. The Wells Fargo scandal involved the opening of hundreds of thousands of unauthorized accounts and credit cards.
California and federal regulators fined the company a combined $185 million, saying the bank’s employees illegally opened the unauthorized accounts meet aggressive sales goals.
Wells Fargo customers shouldn’t have to take any action regarding unauthorized accounts that might have been opened, the Consumer Financial Protection Bureau (CPFB) said.
And going forward, Wells Fargo will send a confirmation email within hours of opening an account or applying for a credit card.
Wells Fargo is trying to clean up the mess that they caused and so far it seems like it is making things right with their customers, said Jim McCarthy, a certified financial planner with Directional Wealth Management in Rockaway.
“If you weren’t affected by their actions, then I don’t see how staying with Wells Fargo will have a negative impact on your accounts and mortgage,” McCarthy said. “On the other hand if you feel uncomfortable working with a company that is susceptible to these improper sales practices, then you should consider moving to your local bank/credit union to have some peace of mind.”
McCarthy said by moving to a local bank, you will have relationship-based personal service, lower fees than big banks and possibly lower rates on loans. But also, you will inevitably give up some perks that big banks offer such as plentiful ATMs and branches, a full menu offinancial services and cutting edge technology tools.
“Moving checking/savings accounts to another bank is relatively easy,” McCarthy said.“Moving your mortgage is a much more complicated decision.”
That would include considering your current interest rate versus the rate on a new mortgage,the costs for refinancing, and more, he said. The numbers would need to be thoroughly analyzed.
“Wells Fargo did have a major scandal but customers that were affected have been reimbursed,” McCarthy said. “Those customers that weren’t affected don’t have anything to worry about. If trust has been lost with Wells Fargo than the other alternatives are joining another big bank that operates in a similar fashion to Wells Fargo or a local bank that will provide a personal touch to your banking experience.”
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Karin Price Mueller writes the Bamboozled column for The Star-Ledger and she’s the founder of NJMoneyHelp.com. Click here to sign up for the NJMoneyHelp.com weekly e-newsletter. Like NJMoneyHelp.com on Facebook and follow it on Twitter.