Chase Bank makes stupid offers, and loses money by failing to live up to them

I recently wrote about how Chase Bank's inflexible systems just cost it money by not allowing me to make a $100 payment to my mortgage account to make up an erroneous underpayment. Instead, I had to make an entire additional payment, depriving them of a significant amount of future interest.

In January, I received an offer from Chase Bank to open a checking account with them, with a minimum deposit of $100. After I set up direct deposit, within ten business days of the first deposit they would deposit $125, which would be mine to keep so long as I left the account open and receiving direct deposits for at least six months.

I asked an online banker whether there was any minimum amount that had to be direct deposited, and was told no. I decided to set up the account in person at a branch near my office, and again asked whether there was any minimum direct deposit. The banker told me no, there was no minimum--if I wanted to deposit only $1 per paycheck, that would be fine.

As I have no interest in using Chase Bank as my primary bank--I'm quite happy with a regional bank that is one of the top-rated places to work in the country and has demonstrated reliability to me repeatedly over several decades--I decided to maximize my return on this otherwise non-interest-earning account by minimizing my deposits. My employer provides a convenient way for me to control my own direct deposits into up to three different banks, so I added a new direct deposit of $0.01 per paycheck into my new Chase Bank account.

The first $0.01 went in on January 15. On January 30, no $125 had been deposited, so I sent an online email inquiry asking when I could expect to see it. A response a couple days later told me I needed to call in to get an answer to my question, so I dialed the toll-free number, waited on hold, and finally got to a person who told me I needed to wait four to six weeks after the first direct deposit.

My second $0.01 went in on January 30. My third $0.01 went in on February 13. Still no $125.

Today, I got another $125 offer from Chase Bank, which prompted me to dig up my application materials and see that they promised my $125 would be deposited within ten business days, not four to six weeks. So I called and left a message for the banker at my branch, I sent another online inquiry asking whether Chase Bank is going to remedy its failure to honor its offer, and called in to the toll-free number again. I described the issue to my "telephone banker," and he asked for my account information. When he brought up my account, he asked if the $0.01 deposits were pre-authorizations for direct deposit, and I told him no, those are the deposits--I was told multiple times that there was no minimum deposit, and there is nothing in the written offer that mentions a minimum deposit. He was unable to solve the problem, and said he would have to send it to be researched, and I would hear back within a couple of days.

If they didn't want to honor the offer, they shouldn't have made it in the first place. By failing to live up to it, they're costing themselves even more money. It's surprising to me that this is probably the strongest of the major banks in the U.S., and the least likely of the majors to end up costing the U.S. Treasury money in the long run from the TARP's preferred investments ($25 billion put into Chase so far).

UPDATE (February 18, 2009): I received a voice mail from Chase Bank stating that the promised $125 will be deposited into my account within the next two weeks. My real-life banker left me a voice mail saying that the issue was that their system doesn't automatically count direct deposits for issuing an award if they are less than $1. So they do intend to honor their offer, it will just take longer since I used the system in a way they apparently didn't anticipate (or did anticipate with the same reasoning companies use with rebates).

UPDATE (February 25, 2009): My $125 was deposited yesterday.