After finding disturbing money float issues with Chase, I checked our company’s Wells Fargo credit card account for the Float Pay Scheme I outlined before. Sure enough, it is used by Wells Fargo, too. I really should be calling it the Float Pay Scam.
It turns out we made a payment of the balance in full late in March for $3,600. The payment shows as “posted” on 4/1/2011 in the online account register. Curiously, it was not included in the “available credit” total. So I called yesterday, April 15.
The agent told me that the payment was in hold and would be posted “tomorrow.”
I said: “No, it shows as posted on 4/1/2011, right here?”
She said: “Yes, that’s when we received it.”
“Why does it show posted when it really isn’t posted?” I asked.
“It’s probably because you didn’t use a Wells Fargo checking account to pay. So we hold until the check clears the bank.”
I checked our checking account. The check cleared on 04/04/2011. The evidence is that Wells Fargo took our payment, received the money, and did not make that money available to us through the credit line until twelve days after the check cleared the bank. My first reaction is that this is illegal, a scam. But when I think about it, essentially, there is probably nothing wrong with this, since it’s a credit line and it’s their money that they are lending out. So they are lending it just a little later.
What is really going on it that they are using our money to lend it to others at high interest rates. What’s wrong with this is that they are lending it to us just a little later. If we are paying off our entire balances this is not a problem, because we are not paying interest. However, if we are paying interest on this money, are they collecting double interest? There is no way to tell, from the account statements, when they are charging interest for our money to us, and to others, through the float.
For us consumers, it would be much better to get prepaid cards, which would be like debit cards, and our own money would be available without restrictions to ourselves the moment we make the payment.
What is REALLY wrong is that the credit card companies are now doing this without consumers knowing about it – and rejected credit cards at hotel desks are very embarrassing.