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On the surface, this looks bad. But, the underlying logic - that Wells Fargo doesn't want to loan you money so that you can buy money - seems reasonable to me.
by philip1209 8y ago
On the surface, this looks bad. But, the underlying logic - that Wells Fargo doesn't want to loan you money so that you can buy money - seems reasonable to me. If you have cash in a Wells Fargo checking account, you can still buy cryptocurrency with it.
- ddtaylor 8y agoIMO it's less about the people borrowing money and more about the potential fraud.
- Broken_Hippo 8y agoI think you are correct. After all, many credit cards have a cash advance feature that will allow you to borrow money to get money. Similar restrictions are commonplace for things like money orders, western union, and prepaid credit cards.
- vxNsr 8y agoIn fact citi is posting some of the transactions as cash advances.
- Bud 8y agoJust as an illustration, the fraud risk is so bad that someone as smart as Steve Wozniak had bitcoins stolen via simple fraud. https://www.marketwatch.com/story/steve-wozniak-had-70000-in-bitcoin-stolen-after-falling-for-a-simple-yet-perfect-scam-2018-02-28 https://www.marketwatch.com/story/steve-wozniak-had-70000-in...
- gruez 8y agojust because Wozniak is a good programmers, doesn't mean he automatically knows how to secure cryptocurrency. a fairer comparison would be if a cybersecurity expert's coins got stolen.
- notahacker 8y agoI'm sure Woz has a better idea of how to secure stuff on computers than 99.9% of people. If you need to be a cyber security expert to not run a significant risk of being defrauded, then it's obviously something credit card companies shouldn't be considering acceptable risk
- Someone1234 8y agoBy that logic they should ban gift cards and in-game currency too. Sure, you can use your checking account, but if my credit card is going to restrict my usage and I'm going to be hassled into circumventing it, then why even have it? I actually have a Well Fargo credit card, I'll be keeping an close eye on these restrictions.
- toomuchtodo 8y agoGift cards and in game currency aren’t a loan. Your lender reserves the right to constantly evaluate your credit worthiness and restrict access to that credit at their discretion (and speculating on a commodity with unsecured credit is risky af). When you say “why even have it”, the answer to your rhetorical question is “it’s still a useful, and some might say necessary, financial tool”. Disclaimer: I work in risk management, but not at Wells.
- kempbellt 8y agoWhen you provided a credit line from a lender, your credit worthiness has already been evaluated - hence, being granted the credit line. Why should the lender being involved in deciding what you spend that credit on, provided it wasn't a part of the original contract (eg. a car loan), and you continue to make your payments?
- deleted 8y ago[deleted]
- bduerst 8y agoBecause risk is a time function, not static. If credit providers approved credit at one point and time and never reviewed or limited it, they would be exposing themselves. Your example (car loans) have time limits and contracts that account for risks in the time limit - the longer the time limit, the more potential risk. Credit on the other hand is ongoing.
- TheCoelacanth 8y agoIt was part of the original contract. A credit card isn't a completely unrestricted line of credit. You either need to use it in transactions with merchants that they have a payment processing arrangement with or use it for a cash advance that comes with extra fees to offset their increased risk.