Why does my Wells Fargo account show checks cleared before payee even receives?

Joe Hopwood

I have several accounts at multiple banks and with all but Wells Fargo the checks in register are cleared on download when payee has cashed and check returned to sending bank. It appears that Wells Fargo clears a day or two after sending when payee has not even received. Wells Fargo says they do not know why that is happening.

Tom Young

Are you using the Wells Fargo "bill pay" service to send these checks?  If so, here's WFB's FAQ about this:

When does Wells Fargo withdraw the money from my checking account for a Bill Pay payment?

We withdraw the money from your checking account on the business day following your payment Send On date. Depending on the payee, your payee will receive the payment within two to five business days.

Joe Hopwood

Thanks for the reply Tom but it really does not address my question or concern.

When funds withdrawn from account has nothing to do with definition of cleared. See below.

For all other banks I have used, I know that payee has been paid when I see it cleared. In one particular case with my business account, I sent a check to myself. That check has been cleared for days and I have yet to receive the check. It is not unusual for a check to take two weeks or more with Wells Fargo. Perhaps Quicken needs to add a fourth category to the Clr field to indicate funds withdrawn.

A cleared check has successfully completed the banking process so that the payee has received the funds. Cleared, in regards to a check, means it has gone through the complete banking process: You wrote a check for the mortgage. The mortgage company deposited the check into their bank account.

Tom Young

You didn't answer my question about your use of the WFB bill pay service.

But, assuming you do use that service, "cleared" from the bank's standpoint - and they are the ones sending that information to your Quicken file - is "cash removed from bank account", not "check has been presented and processed."

Many bill pay services take this approach to paper checks mailed out.

Joe Hopwood

Sorry Tom, I thought me saying I sent a check to myself made that self-evident, but yes indeed I was going online and using their bill pay service.

I really don't think that "Many bill pay services take this approach to paper checks mailed out.", addresses the question at all. There is a definition universally accepted for a "cleared" check and removing funds from account is not in that definition. See my previous response please.

WFB should not tell Quicken a check is cleared just because funds are removed.

Tom Young

Well, you're going to have to take that matter up with WFB because they are the ones sending the information to Quicken (I'm assuming you're downloading). 

As far as I know there's nothing in the OFX schema that indicates, first "we've withdrawn the money from your account but the check hasn't been presented yet" and then, second "you know that check where we withdrew the cash a day after it was mailed?  Well now it's actually cleared the bank."  So I don't think Quicken can do a thing about this situation.

I use Schwab Bank bill pay and, occasionally, I've seen the same thing happen when an actual check is involved.

jrich75

Joe Hopwood said:

WFB should not tell Quicken a check is cleared just because funds are removed.

In the current era of electronic banking, there are many instances where traditional definitions no longer apply.  As @Tom Young says, this is a WFB issue not a Quicken issue.  I believe Quicken defines the smal c to mean " marked as cleared on your financial institution website".  So, how does WFB treat the check?  I have FIs that use independent bill payment services to print and mail checks.  They do an ACH of funds to the check processor.  So the funds are gone immediately.  Maybe if Quicken changed the "c" to a "d" (for debited) things would be clearer (pun intended).

Joe Hopwood

If I write an actual check, how would bank know it until payee had cashed? Big brother looking over my shoulder? :-)

I have submitted a problem report to Quicken. If I hear anything, I will be back!

jrich75

Joe Hopwood said:

If I write an actual check, how would bank know it until payee had cashed? Big brother looking over my shoulder? :-)

I have submitted a problem report to Quicken. If I hear anything, I will be back!

But what you are doing is more like visiting the bank and asking the cashier to print a counter or cashiers check.  The bank does know the check has been issued.  Still seems like a WFB process issue and not something Quicken can change.  

Joe Hopwood

I do not know where the fix lies. Perhaps a combination of WFB and Quicken changing their interface protocol to support the additional status of funds withdrawn but not yet cleared. What I do know is Quicken is my interface to banks and that is where I see an incorrect check status. However since I have been a Quicken user from the beginning and have never seen this happen with any other bank, perhaps the issue does lie with Wells Fargo. I do think they are the worst customer relations bank I have ever dealt with, but I have no choice as it is not up to me which bank my HOA uses. I did drop them from the last HOA as others did not like them as well. I may just suggest changing banks at next meeting and at least my problem would be solved.

jrich75

I'm curious. What date does WFB show for the checks on your statement?  Do they provide an image of the negotiated check? For some of my FIs it is always the date I ask for the check to be issued and I never get a image/copy of the check itself.

Joe Hopwood

I entered the check online on 4/2 and the date of the online posted transaction is 4/5 and I received the check in this mornings mail 4/10. Date on the check that I received is 4/5 also. There are no details other than amount available online right now. I will have to see if details appear soon. I used mobile deposit to deposit the check to my BBVA account this morning. BBVA processes bill pay checks the same as if I wrote a paper check and mailed. As I work for the HOA, I hope to see if I can send pay directly to my BBVA account and skip this issue and the mail delay.