It should be a simple transaction: Walk into a bank, endorse a check and put it into your account. But if you’re Black, sometimes it’s far from simple.
Black customers can end up being profiled by bank employees. Some customers’ experiences range from simply being unable to deposit a check to facing police called by the bank to ending up in jail falsely accused of fraud, according to media reports.
— A woman in Atlanta, Clarice Middleton, told The New York Times she was accused of fraud when she tried to cash a $200 check at an Atlanta Wells Fargo branch in December 2018. Bank employees called 911 on her.
— In January 2020, TCF Bank in Livonia, Michigan, wouldn’t allow Sauntore Thomas of Detroit to deposit large checks he had received for — of all things — the settlement of a racial discrimination lawsuit, the Detroit Free Press reported. Police were called, and Thomas was questioned but not arrested. He was able to deposit his checks later that day at a Chase Bank.
— In 2010, when Ikenna Njoku of Auburn, Washington, went to a Chase branch in an attempt to cash a tax-refund check of about $8,500 — a check issued by Chase — not only was he stymied, but he also was accused of fraud and jailed over a weekend before police got word from the bank that it was a mistake, KING-TV reported.
The three above incidents all resulted in lawsuits.
[Read: Best Checking Accounts.]
How Should Banks Treat a Customer Who Wants to Cash or Deposit a Check?
Banks have different policies when people deposit or cash checks, especially if the person is not a bank customer.
Two forms of unexpired government-issued ID that include a photo are acceptable, says Shane Franklin, senior vice president, director of operational service support for BBVA USA. Bankers can request additional ID if there are red flags, but Franklin did not provide any details.
Customers who are asked to present additional forms of ID should ask to speak with a manager, he says.
Stacy Kika, an assistant vice president of corporate communications at Wells Fargo, did not state how many forms of ID are required to deposit a check, and no information was found on the bank’s website, but says a customer “must meet all requirements of identification and verification, and the check must be endorsed correctly. Our policies and procedures are specific to the type of check and amount and are designed to protect our customers and their accounts.”
Citibank says that customers depositing a check do not need to provide an ID, but the teller must verify the payee name on the check matches the name of the account holder, says Elizabeth Fogarty, managing director of global consumer banking public affairs at Citibank.
“The customer either dips their debit card into the reader and enters their PIN or presents a deposit ticket with their name and account number,” she says. “For security purposes and to protect customers, if names do not match, check(s) are not accepted for deposit.”
Citibank has more stringent requirements for cash transactions and requires customers to provide their name, address, birthdate, Social Security number and occupation.
Noncustomers who want to cash a check at Citibank must show a government-issued photo ID.
“This is the industry standard regardless of amount,” Fogarty says.
At BBVA, “if a customer is requesting large amounts of cash, we may require two forms of ID,” Franklin says.
Wells Fargo has a similar policy, and Kika says that noncustomers who want to cash a check issued on a Wells Fargo account are eligible if “there is no stop-payment order on the check, there are sufficient available funds on deposit to pay the check, the check is solely payable to the noncustomer and they present proper identification.” The person may also need to provide their fingerprint on the check.
[Read: Best Savings Accounts.]
What Are Signs That a Bank Is Being Unreasonable?
Banks and credit unions typically accept several forms of ID to conduct transactions, such as a driver’s license, federal or state ID card, military ID, or a U.S. passport. Depending on the bank’s rules, one form of ID is often sufficient, but for more complicated transactions or ones for larger amounts of money, two forms of ID may be required.
Whatever the bank’s official policies, customers may face prejudiced attitudes by employees.
Terri L. Friedline, an associate professor at the University of Michigan School of Social Work, spoke to tellers and branch managers in studies about how they serve customers. Some of them cited instances when they refused to cash a check from a Black or Hispanic customer. These employees also made comments about serving customers who were “rude, untrustworthy or smelly,” she says.
The interviews with employees, 75% of whom were white, were “so consistent and so patterned,” Friedline says, which suggests that the racism is “pervasive and common and an integral part of the structure of the institution,” she says. “These were not just stories told by one or two people. Everyone shared these stories, across various banks and states.”
Steps to Take if You’re Treated Unfairly by a Bank
Consumers have few options for recourse when they have been discriminated against. The majority of banks say their policy is for customers to alert the manager, but Black customers may have faced the same treatment from managers, too. Another option is to file a lawsuit, but they can be expensive and take years.
Citibank recommends speaking to a branch manager and escalating the issue by contacting the bank through chat, by phone or in writing.
[Read: Best CD Rates.]
“The branch manager will also escalate the issue internally for review and resolution,” Fogarty says.
One underlying issue is that the workforce of bank branches is often not very diverse, even when they are located in Black and Hispanic neighborhoods.
Wells Fargo stated that as of Dec. 31, 2019, out of 260,000 full-time employees, 45% of its U.S. workforce is ethnically diverse. Wells Fargo’s CEO Charlie Scharf said recently that the bank plans to double Black leadership over the next five years. The bank’s current senior leadership is 21% racially or ethnically diverse, with 6% who are Black.
Citibank says that as of June, 48% of all its U.S. employees are minorities, up from 45% in 2018.
More from U.S. News
9 Banks That Offer Bonuses for Opening an Account
What to Do if You’re Racially Profiled While Banking originally appeared on usnews.com
