WaMu to IndyMac Customers: Your Money's No Good Here

What in the world are the people at WaMu (WM) thinking now? You might assume the bank would be drooling over the prospect of picking up a bunch of erstwhile IndyMac customers and their deposits--especially given the turmoil going on elsewhere at WaMu. You would be wrong.  

The Los Angeles Times reports the bank has a policy of not accepting IndyMac checks, even though, as everyone in the world knows, those checks are backed by the FDIC. Which is to say, they’re backed by the federal government. Still not good enough!  Customers who insist on depositing IndyMac checks have to wait up to eight weeks before they can get full access to funds, the Times says.

Yet another example of a big bank taking a golden marketing opportunity and transforming it into a new way to tick off their customers and prospects.

Comments

[Thedudeabides]

How do these kind of articles even get published. This guy writes that WAMU wont except indymac customers. It should say wont except checks on accounts that are in limbo where liquid funds are not accessable until a time that the feds decide to reimburse the indymac folks, which they will up to 100,000. WAMU I am sure wants all the bank customers in the world but not more unsecured debt. The writer of this article needs to do more homework and less yellow journilism which this obvisouly is, the point is that WAMU would be cashing checks that have no funds to back them up. oh i guess wamu could go to the feds and say oh i got these checks here from these indymac folks and we need to collect, yeah right. Were you one of those folks who WAMU wouldnt cash your check so now your lashing out, sounds like it or I should say reads like it.

[John W]

Wow.. are you JUST reporting this now? First of all, this "news" was reported last week. Second, this is NOT TRUE. WaMu is accepting the checks just fine, but with the other sensational WaMu bashing news that came out last week, the media turned maybe some special handling procedures for those checks (understandably, how can they really be sure those checks are good?) into "we can't accept them". If you're reporting this now, over a week later, I would have thought that at least you would get the story right.

[CABANKER]

I can't believe that Vernon Hill is allowed to opine/comment on banking and finance issues after his track record at Commerce....

[Washingtonian]

I can't believe this guy is allowed to comment either especially after he was ousted, for his really bad record and standings in the commerce sector. I can't believe that they would even publish this from him, maybe they need a new editor? My partner works for WM, and is a First VP, and bad published articles like this one hurt his as well as others, retirement, and have caused a lot of bad talk about WM when they are doing a heck of a lot better than Wachovia....

[EZ]

Thedudeabides: I agree with the idea you are attempting to communicate in your poorly written comment. However, if you want to critique someone else's posting without making yourself look/sound like a total idiot, I would suggest you learn some proper word usage and spelling--at least starting with easy words like "accept" instead of "except" (Makes it look more professional and readers might take you seriously).

[tiredofallthecrap]

what an idiotic article....the author obviously doesn't know anything about banking

[User 225305]

WAMU is getting beat down enough...This letter means NOTHING..NOTHING...NOT... will be at 7 or 8 before the New Year......I bank at WAMU and love their great service. Every time I deposit a check, even at the ATM, they credit my account immediately with the full deposit amount. On the other hand I used to bank with Wells Fargo. When you deposit a check there they always put atleast a one-day hold, even for Government checks. Now that's nuts and that's why I don't bank there any more.............sj

[cerpika]

Vernon, how would you react if your paycheck was drafted from a IndyMac account right now? I guarantee you would not be OK with this, and I guarantee that you would wait a while after you deposited the check before spending those funds.
WaMu is doing no different. And to try and position it as if WaMu is not interested in ex-IndyMac customers is just plain ignorant & misleading.

[gatekeeper]

This has been a topic of discussion at Consumerist since ~ July 17th:
consumerist.com/502622...
.. based on a 7/16 LA Times article.

[Serge]

JESUS H. CHRIST. PLEASE CHECK YOUR FACTS BEFORE QUOTING YELLOW JOURNALISM. THE COMPANY HAS ANNOUNCED THAT THEY ACCEPT INDYMAC CHECKS.

[BankerJ]

This guy is passing off rumors as journalistic fact! First of all this rumor was placed in a Los Angeles fish-wrapper over a week ago and debunbked then. I am surprised this moron is allowed to have a job for writing such blatant lies. This "rumor" started last week in the early hours after the fall of Indy Mac. One customer went to take their check to a WaMu, where they were told the check would have a hold placed on it, as is the practice with ALL checks deposited. This startled an already panicked depositor, who then ran to the media to cry.

For starters the bank has to be certain that the check is legitimate and not a fraud. Has anyone seen the movie "Catch Me if You Can?" If you have, you will understand why ALL banks have a check hold policy. WaMu is not placing any extra restraints on Indy Mac checks that they don't already place on other bank's checks.

I personally know people who had accounts with Indy Mac who have taken their checks issued by the FDIC straight to WaMu and had no problem opening an account with them, to the tune of hundreds of thousands of dollars mind you.

I think Vernon Hill must have shorted WaMu stock and needed to see it drop a little farther. Perhaps HE has an account at WaMu and someone there refused to override an overdraft fee for this idiot. You should not be allowed to write for any publication, online or other, when the facts that you state in your piece are nothing short of blatant lies. In fact I believe that he can be sued for posting such false information. Anyone worth their salt as a journalist learns in Journalism 101 in college that you must check and verify your sources. This amounts to someone running into a theater and yelling "Fire!" when there clearly is no fire. Maybe the folks at WaMu would like to see Vernon’s article. Then he and the site that didn’t check over the validity of his post can be held accountable.

[PortfolioGuy]

In case you want to know want happens if your bank goes under, I recently wrote about what is covered on my blog.

[rookie101]

blah blah blah- i am going to take my picture and post next- blah blah blah

[Ave. Joe]

See below - FDIC isssue regulatory directive to the "institutions&quo... in question. Folks, when in doubt, don't spin....get the facts.

Go here: www.fdic.gov/news/news...

See this: Financial Institution Letters
FIL-67-2008 IndyMac Federal Bank, FSB: Official Checks

>IndyMac Federal Bank, FSB Official Checks FIL-67-2008 July 17, 2008
Summary: The FDIC is issuing clarification for payment of IndyMac official checks.

[Ave. Joe]

Trust me, it's not smart to snub a regulatory directive......

Financial Institution Letters
----------------------... Federal Bank, FSB Official Checks FIL-67-2008 July 17, 2008

Summary: The FDIC is issuing clarification for payment of IndyMac official checks.

Highlights:

There have been reports that some financial institutions are refusing to honor or are placing excessive holds on IndyMac's official checks as customers attempt to deposit them.

Your bank should honor IndyMac's official checks, such as cashier's checks, to the same extent that your bank honors any other bank's official checks. We request that your bank consider processing these checks as official bank checks and local items for clearing purposes.

IndyMac Federal Bank, FSB, was created to continue to provide banking services in communities served by the former IndyMac Bank, F.S.B. The FDIC is managing IndyMac Federal Bank, FSB, as a newly chartered FDIC-insured institution opened Monday, July 14th. It is business as usual.

The fact is that for insured depositors the formation of IndyMac Federal Bank, FSB is largely a non-event. IndyMac's insured customers continued to have access to their insured deposits through ATMs, debit cards, and writing checks over the last weekend, and they continue to have access since IndyMac Federal opened on Monday morning.

Distribution:
FDIC-Insured Financial Institutions

Suggested Routing:
Chief Executive Officer
Chief Financial Officer

Related Topics:
Negotiable Instruments
Article 3 Uniform Commercial Code
Regulation CC

Attachment:
None

Contact:
Robert J. Wirtz, San Francisco Assistant Regional
Director, at [e-mail] or 415-808-8073.
Joseph J. Sano, San Francisco Regional Counsel,
at [e-mail] or 415-808-8177.
Lawrence F. Bates, Counsel, at [e-mail]
or 703- 562-2284.
Kenyon T. Kilber, Senior Examination Specialist, at
[e-mail] or 202-898-8935

Printable Format:
FIL-67-2008 - PDF (PDF Help)

Note:
FDIC financial institution letters (FILs) may be accessed from the FDIC's Web site at fdic.gov/news/news/fin....

To receive FILs electronically, please visit www.fdic.gov/about/sub....

Paper copies of FDIC financial institution letters may be obtained via the FDIC's Public Information Center (1-877-275-3342 or 703-562-2200).

[Exbanker]

You are all off base...the Feds (FDIC) "Insurance allows the government up to 12 YEARS to give the investor's money back. Check it out - I am a retired V.P. for Bank of America and KNOW that this is the case, BUT, when opening accounts all the CSR's did was assure customers that their money was "safe" under "FDIC". ..NOT about the TWELVE YEAR clause.

[Flathead]

WAMU is rejecting the customers who "panicked" and made a run on the bank. Who needs them?

[jackooo]

Washington Mutuals 8 week hold on checks is dumb. What bank holds a check for 8 weeks? Even BOA doesn't. Duhhh.

[oldtrdr]

There MIGHT be something to this. I've been a WaMu customer for 2 1/2 years (a small personal account). In that time, I've NEVER bounced a check, nor have I EVER had a deposited item returned, for any reason. Suddenly, about 2 weeks ago, I started getting notices from WaMu about holds being placed on deposits to the account, via their ATMs (which is what I normally do). This started about the time of the most recent "turmoil" in the stock.....a bit odd, no?

[Ave. Joe]

Exbanker - please cite regs. I would like to understand interaction between enabling legislation, governing regs., and policy since I am new to financial regulations. Can't be as complicated as HHS/CMS regulating health plans/drug plans! In fact, I'm amazed at the dearth of comments submitted on the draft regs recently enacted (phase I) considering the impact.