A massive bank now freezes money from direct deposits affecting several users. The giant says it was an unprecedented glitch.
Bank of America clients have been saddled by direct deposit delays following a payment processing glitch.
Customers began to report digital payment delays to Bank of America.
Social media users tagged the bank to explain how their paychecks hadn’t yet hit their accounts in November.
“Bank of America Day 4 & still no direct deposit, no update on potential resolution,” one user wrote on X.
“Or at the very least what’s being done to resolve the issue, no transparency, no assistance, no communication from you all at all. Nothing. Wow. This is so bizarre.”
Wells Fargo clients also reported experiencing direct deposit lags, and both banks reported questions to The Clearing House.
The Clearing House is an automated clearing house system that operates as a private sector in the US.
The Clearing House told CBS MoneyWatch that payment instructions were sent to banks due to a “processing error.”
Payments were delayed since banks needed to process data and incoming payments to clients’ accounts.
The company said it worked with the affected customers and the Federal Reserve to fix the issue.
“Many of the delayed payments have already been posted, and we will continue working with financial institutions to ensure the remaining transactions are processed,” The Clearing House wrote.
An ACH network enables money to be digitally transferred between US bank accounts.
The Clearing House and the Federal Reserve Banks process millions of payments daily, as per The Clearing House.
Its process involves an operator sending a file to a bank or credit union and allowing the institution to transfer funds into a client’s account.
The Clearing House posted a statement on its website saying the payment error resulted from masked information, “due to a TCH error.”
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Also Read: The US Treasury Direct is Now Freezing Customer Accounts
Other Banking News Today
A massive bank is now laying off 430 workers in June according to four notices posted Monday with the state’s Department of Labor.
Citi has announced that 430 workers will be laid off on June 29.
The staff cuts encompass 363 employees in Citi’s primary banking unit, 62 in its global markets broker-dealer, four in technology and one in its Citishare unit, according to the Worker Adjustment and Retraining Notifications.
Monday’s cuts follow a wave of 286 New York-based job reductions, set to take effect by early May, that the bank posted in February.
Citi announced last week it had “concluded the major actions” associated with its multi-stage reorganization, which the bank launched in September.
The moves eliminated five layers of leadership and consolidated roles with overlapping responsibilities, reports Banking Dive.
Citi CEO Jane Fraser said in January the bank had cut 1,500 managerial roles.
The bank is aiming to trim 20,000 roles from its headcount by 2026.
The reorganization is meant to save the bank $1 billion in annual costs.
Among the hardest-hit units in Citi’s most recent cuts is technology, media and telecom, people familiar with the matter told Bloomberg.
Yaseen Choudhury and Abhi Singhal, both managing directors on the financial technology team, have left the bank, sources told the wire service.
Equity capital markets, debt capital markets, financial sponsor coverage and clean technology banking also saw cuts, the sources told Bloomberg.
Juan Carlos George, the managing director leading Citi’s equity capital markets efforts for Latin America, is among those who have left the bank, the wire service reported.
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Also Read: Retirees Will Now Receive More Money For Social Security
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