Marianne Glamann, Manager
Wayne Bank
5165 Milford Road,
East Stroudsburg PA 18302

Dear Ms. Glamann

I have been around 'banking' for more than fifty years as a small individual customer and as a fairly large corporate customer. As the CFO of a company I became very familiar with cash management and local and international transactions. Earlier in my career I learned the principles of auditing, notably the idea that being told something does not substitute for what is written down. later, doing consulting assignments for the UN and World Bank I saw large scale corruption and bank misfeasance first hand.

Last Monday (August 27th) I was surprised that a fairly large personal check drawn by my wife on J.P. Morgan Chase in New York City would not become 'available' for seven business days. This is way slower than anything I remember from my past banking experience, yet the technology to do 'clearing' is arguably perhaps a million times better than it was years ago. With some justification, I allowed myself to 'rant' about this to the staff of the branch, including the branch manager.

By way of explanation I was told that it takes so long because of the massive amount of fraud. While this may be a problem it begs the first question and raises another. If there is so much fraud in the banking system, whatever happened to the requirement that a bank 'knows its customers'.

As a courtesy, a call was placed to Chase to try to accelerate the clearance, but this turned out to be impossible apparenly because of 'rules about privacy'. I understand rules are needed, but it would be nice to have sensible rules.

With regard to the issue of a bank knowing its customers, this surely is important, but it seems to me that in practice it has become something of a farce.

A few years back ... about 2005 ... I was made to jump through hoops to open a savings account for my teenage son who had been in and out of the bank branch since he was 2, and both his parents had accounts in the branch since before that.

Shortly after that experience I accompanied a Nigerian reporter to a major bank branch in New York City to alert the bank to a substantial case of money laundering. The information we had concerned a high level politician in Nigeria who was misappropriating millions of dollars and transferring them to his account at this branch in New York City. My expectation was that the bank branch manager would be 'interested' in what we had concerning his customer ... but the exact opposite was the case.

After my Monday rant about the time it was going to take to have available funds, I made alternative arrangements so that I would have suffficient avilable funds for my needs the following day. This was a transfer into the account from another account ... my wife's account in the branch where I have Power of Attorney. Next day I used a bank ATM to withdraw a small amount of money, and was absolutely delighted to learn that I now have a total balance of $42,000 with $42,000 available. According to this I was not going to have to wait the seven days for available funds after all.

On the strength of this I write four checks for $10,000 each to a contractor and relaxed. During the balance of the week I had some increasing disquiet because balances on subsequent ATM withdrawals did not reconcile neatly to what I thought was going in and out of the account.

On Saturday, after the banks had closed I learned my disquiet was warranted. I was refused a small cash withdrawal from the bank ATM and then learned my balance was now negative $18,000. The bank would not open again until Tuesday after the Labor Day weekend ... I had no cash money, no plastic money ... just a 'piggy bank' of parking meter quarters. I was furious. My plans for the weekend were ruined. But nothing could be done to mitigate the problem until Tuesday.

When I went to the branch after it opened on Tuesday I was told that I should have paid attention to what was 'said' in the bank the previous Monday ... that is that the funds would only become available after seven business days, and that I should have ignored what was printed on the ATM receipt on Tuesday. The idea that I should ignore what is written on a bank ATM's receipt seems to be counterintuitive ... but that is what I was told.

I am not sure how this saga will end. I had to figure out how to meet all my obligations this Tuesday and Wednesday without running foul of bank rules some more.

During the course of Tuesday I had a series of conversations with senior bank officials and later in the day I reported back to the branch that I had raised the question of incorrect 'availablility' reporting on the ATM receipts, and that this 'glitch' would in all probability be addressed by the IT and accounting team of the bank. To my surprise and chagrin I was again told that the ATM balances are always wrong, that I should know this and not rely on an ATM balance.

Well OK ... up to a point. I am aware that a Visa or Mastercard branded ATM/Debit card can be processed as a 'credit card' rather than as a 'debit transaction' and in those circumstances there will be a delay in the amount being debited to the account, and therefore the balance could be overstated. Yes, and I understand checks I have written take time to be presented and get processed. I know how to reconcile a bank account/bank statement. In my experience debit transactions seem to be deducted instantanously, with the exception possibly of using a bank card to purchase gas at a filling station where separate rules seem to apply. My understanding is that availability is a computation based on the account balance less the amount being held, and not influenced by the time delays associate with the total balance.

In broader terms, I am not at all happy with the modern banking system. The big banks are little more than a legal extortion racket ... facilitating a lot of obscene practices that are profitable but anti-social and doing serious damage to society at large.

Smaller banks with a community focus are unbelievably important and have to step up to provide the key banking services that make it possible for a good economy to run. I think of banks as being an essential 'lubricant' for the economic system without which the engine of the economy seizes up. What the bank does is neither engine or gas ... but still very important as the lubricant of the economy.

Peter Burgess.