Why I Canceled American Express Bluebird and Opened a Brokerage Account Instead

On October 9, 2012, I was high on the promise of American Express’ Bluebird prepaid card and “bank account.”  By November 2 of the same year, I had enough, as I mentioned in a comment on my original Bluebird review:

Bluebird is majorly sucking. On Oct. 31, during Halloween Sandy, we received an emergency email from Bluebird support that my wife’s account had been locked for “security reasons.” We decided to spend precious battery time in the middle of a power outage to call and find out what was happening. It turned out someone else was trying to login to her account and instead of locking THEM out, AMEX locked out my legitimate wife from her account! Madness! Terrible security. Why punish the innocent party by making them call in and go through a 15-minute security test when we aren’t the ones causing the login problems?

Just now, we received another freaking email from Bluebird about the same issue! My wife’s account is locked for security reasons! She hasn’t tried to login to her account for days! I’ve been trying to reach AMEX support for 30 minutes. Lines into the Philippines tech support center on this Sunday are clearly not working. What a hassle!

I’m thinking we will have to cancel our Bluebird account.

Today, I made good on my promise and canceled my Bluebird account over the phone — unlike AMEX Serve, Bluebird accounts cannot be canceled online — and the only reason I waited a few days to pancake Bluebird was because I first needed to zero out my balance with an Automated Clearing House (ACH) withdrawal to my bank account, and Bluebird, unfortunately, takes many days to process any ACH transaction.

I think Bluebird has limited promise for those who do not have a traditional checking account, but my advice is to create a really unique username during sign up that nobody can guess, or you will be forever hassled by Bluebird servicing as they repeatedly lock your account for security reasons that have nothing at all to do with your behavior.

There’s something really wrong with a security process that punishes the innocent user and not the confused/bad actor out there in the wilds trying to login/compromise an account.  Since Bluebird uses usernames — Serve uses your email address — to login to their system, if you were fortunate enough to be an early adopter and get the precious username you wanted before anybody else, you will be punished for that move as others dumber/meaner than you try to use your “guessable” username to login and you get locked out of your account.

When I first called AMEX to get my wife’s username changed, I was told I could do it myself online.  When I told them that was not true, Bluebird support hung up on me.  I called back four times for the same username issue, and was subsequently hung up on each time.  It seems the Philippines call center for Bluebird really have no idea how to solve anything substantive, and their training appears to dictate they just disconnect you instead of confessing they have no clue how to help you.  I am not alone in this “We Hang Up On You!” style of Bluebird customer service:

I read the Terms and Conditions and began to register only to be told the card is not available in Vermont. I know that 5 dollars is not a lot to many but when I called customer service the rep hung up after I waited 10 minutes. Next I called back and waited for another 10 minutes. She told me she was sorry that Bluebird card was not available in Vermont.

When I finally reached my fifth Bluebird support rep about the username problem, it seems they finally figured out what I already knew:  There’s no way to change a username once your account is established.  You have to cancel the account and then open a whole new account.  That meant I would have to cancel my wife’s sub-account and wait 7-10 days for her to get a new card.

I knew some sort of security problem would start happening with my username too, it was only a matter of time, and so I just decided to cancel everything with Bluebird and be done with the whole experience.  We never even had a chance to try to charge something with the Bluebird card.  Sending a check from Bluebird was also a slow experience:  12 days from check request to actual check delivery = Not Acceptable.

Each time I called Bluebird phone support, it stole 30 minutes from my life.  Canceling my account this morning cost me a bone-boring 45 minutes — 40 of which were spent on hold as the representative tried to figure out how to cancel an account with a sub-account.  Bluebird are not your regular excellent American Express customer service representatives.

What I found most fascinating about my cancel experience this morning with Bluebird was what they did not care to ask me:  “Why are you canceling?”  Instead, the representative only wanted to know, how I “planned to pay my bills without Bluebird?”

I told the rep I would use a different debit card and he didn’t care to know any more.

After living through Hurricane Sandy, I realized I needed a financial backup to my financial backups.  It isn’t enough today to just have one bank account and checking account.  You need to have at least two unique, non-credit card, pathways to your money in case one is unusable.  I thought Bluebird would be a good answer, but, in the end, I was disappointed in both service and expectation.  Bluebird really isn’t a bank – even though your direct deposits get sent to the “American Express Centurion Bank” — and you have no FDIC protection.

I decided to open a no minimum, no-fee, brokerage account that also happens to be bundled with no-fee checking.  I can have a debit card, and checks, all for free.  I can direct deposit.  A test ACH transaction into my 12-hour-old brokerage account from my regular bank had the funds in my account in under 12 hours!  That transaction speed beats Bluebird by a factor of eight!

29 comments

  • With all the people who mistakenly use my email address I’m surprised this hasn’t happened to me as well. Sorry for your bad fortune and glad you found something better!

    • Exactly! It’s the same problem. I’ve learned to user super-secret email addresses and, now, crazy usernames that cannot be guess for any online registration.

      WordPress.com does a great job managing these attempted security break ins. They never lock ME out, they lock out the bad person. If the bad person tries to change my login information, I get an email asking if I requested that action and, if not, to just ignore the message because no changes were made.

      I don’t have to call or login or do anything — because WordPress knows these sorts of security crack attempts are part of doing business, and you don’t last very long harassing legitimate users with the illegitimate behavior of others.

  • Lillian Boyington

    He has a super secret email address. I think I need one, but where to find it? :)
    I’m glad you got the trial and error part done first. I like to learn by watching others learn. It can be less painful that way. And I appreciate you sharing the experience so others can avoid the snafus.

    • You can create a secret email address on Yahoo or Hotmail or Gmail that you only use for doing business online. Nobody but the bank or financial institution would ever email you at that address and you would not use that address for public communication. You could also try to create an alias with your current email address that would funnel the alias email right into your main email address. You’d have to check with your email provider to see if they offer email aliasing. I know Hotmail and Yahoo do aliasing really well just for the reasons described here.

  • I’m on Staten Island and with my bank and everything else in New Dorp still closed after Hurricane Sandy I was considering Bluebird. Thank you for posting the details of your experience. 12 days to clear a check is completely unacceptable.

    • Hi JayJay –

      Actually, it took 12 days for a check written on the Bluebird account to arrive to the payee — five days later than what the Bluebird system promised when the check was cut. You could never pay the rent or a timely bill using the Bluebird check cutting system because the check would not reliably arrive in a predictable timeframe. As well, Bluebird checks are drawn on a “Northern Trust” account with someone else’s signature and no memo, even if you include one, and it’s all just a bit strange. American Express Centurion Bank and Bluebird and Walmart appear nowhere on the check.

      AMEX is sort of infamous for sitting on your money for an ACH and Direct Deposit. An ACH takes five BUSINESS days to clear — other banks and financial institutions take 24 hours to clear payments and transfers. So, if you do a transfer from your bank to any AMEX prepaid card like Bluebird or Serve or the American Express branded prepaid card, expect to wait a long five days as they sit on the interest before making the funds available to you. As well, direct deposits to these prepaid cards seem to appear at the end of the day, and not early in the morning. I’m not sure why AMEX processes their payment days that way.

      On my AMEX card, when I make a payment, the account doesn’t reflect the payment until the next day after 5:30pm. With my other cards, the payment “clears” my account and gets credited right after Midnight. I don’t know why AMEX waits 18 hours longer to credit a payment to an account, but every little moment matters somewhere — to us and them!

  • I wish i would’ve read this before I put hundreds of dollars in my bluebird. Im not having the same issues at you but guess what, bluebird won’t let me make withdrawls !!!!!! Of course they’ll take my money, but what, I can’t get it back ?!?!?! Bluebird is cool with its low fee’s but if you can’t get your money then its completely useless. Thank you for putting this review up hopefully it can save other’s before they go through the BS of bluebird like we have !

  • So Stupid I used my smart phone to deposit the check, the Bluebird.com shown its will take 5 days to put the money in my account, and i wait 9 days now still $0 balance. its super stupid to open a Bluebird account, i better just pay Walmart $3 to cash out my check.

    • I feel for you, Tony! I hope, as you make more mobile deposits, that the turnaround time will be faster as the system learns to trust you.

      I just did my first brokerage internet checking deposit via my mobile phone. Five minutes later, I had confirmation of the deposit and I was told it would be 100% cleared by tomorrow morning.

      • Dave,
        Where did you open your brokerage account? (Apologies if it was mentioned and I missed it).

        • Hi Cal –

          I haven’t mentioned the brokerage account because I wanted to make sure it was more secure and less bothersome than Bluebird and — so far go great! The security features and communication are excellent. I have learned my Bluebird lessons!

          I have a Schwab One account. Normally, you have to open their Broker One accounts with a $1,000 deposit — or set up a monthly ACH transfer of at least $100 — but if you also open an Investment Checking account, you don’t have to have minimums in either the broker account or the checking account.

          You get a Schwab Visa Platinum Visa debit card with no fees at any ATM and you get free checks. You can do Direct Deposit if you like. There’s quite a lot of paperwork you have to fill out and mail in with signatures and permissions and such if you want to do ACH transfers between Schwab and your outside bank accounts, but the customer support is great and they’ll email you whatever you need to fill out. Just tell them what you want to do, and they’ll translate it from the Schwab vocabulary. SMILE!

          I love the Schwab mobile Apps for iPhone and iPad. Depositing checks is now really fast and easy. Bill Pay is also free with the checking account and, if you pay a bill today, bills are paid the next day as long as the payee is already in the system.

          So, for me, the Schwab account is a great secondary protection in light of hurricanes or terrorism or whatever — have many pathways to your cash — and I can also invest with my brokerage account if the moment strikes me. Our main bank is still not open after Hurricane Sandy, so doing regular teller window business is impossible. I have been warned. I took the warning to heart.

          Fidelity also offers similar services to Schwab. People tend to think the online Fidelity setup is faster and slicker — the online Schwab interface is sort of ugly and confusing — and, I believe, Schwab does a hard credit pull on both the broker and the checking accounts when they set up up while Fidelity does only soft inquiries.

  • I wrote a check to my husband so he could use the iPhone deposit feature. The check cleared my account in a day, over 2 weeks later it still is not available on his Bluebird card. He calls daily, gets the same response…it will clear by 9PM. What a joke.

    • I think it’s becoming clearer that AMEX plans to “make their money on your Bluebird money” by holding check deposits and ACH and EFT transfers for many days to sweep the interest into their accounts and not yours. That’s why I think Bluebird has promise as a secondary “bank” account that you don’t rely on daily for instant action. “Deposit and forget it” seems to work best. Using Bluebird as a primary account would seem to not be a great idea if speed and access are paramount when dealing with your money and paying bills.

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  • Same issue I’m having “locked out of my account” been on hold for over an hour!!! This is redicoulos!!! Bad customer service!!! Ill stick to my bank and zero out my acct just like you did!!

    • Sorry to hear about your trouble, Yolanda. There is definitely a problem with locking accounts and then making us wait forever to get them unlocked. If you get locked once, my experience is that it’s only the beginning of getting repeatedly locked out.

  • This service is absolutely terrible. I tried to tke out 550$ at a ATM (not realizing the 500 $ limit) so the transaction was declined. I came home and logged into my account to find that they in fact had debited my account the money plus an ATM fee. I spent over 30 mins with customer service explaining the transaction did not go through due to the limit only to be told “well it looks like it did on our end” and finally i was told “disput it and we will investigate its the only way”… So now I will be waiting days/weeks for my own money.

  • Glad I’m only losing $10 by NOT continuing on with BB!!($5 to buy @Walmart and $5 for the first deposit) After reading all of this it’s the best $10 I’ve EVER spent!!!! THANKS FOR SHARING!!

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  • Stumbled upon this when searching for ACH and Bluebird. We opened it as a convenient way to get bills money from his account and mine into a central spot without entirely co-mingling the finances.

    What a nightmare. My car loan company told me if I had a direct deposit routing/account combo, they could use it for ACHs. They initially got an approval number, but ten days later it’s bounced!

    My pin doesn’t work half the time. Most stores will only run it as credit anyway. I can’t use it, even as debit, where Amex isn’t accepted. I never – not once, even a $200 transaction – have had to sign at Wal-mart.

    I’ve opened a cheap account at the local bank in Wal-mart. I’d rather pay the $4 foreign ATM fee to have a bank I can use.

    • I’m sorry to hear about your trouble, Becky. I am still uncertain how the Bluebird accounts are supposed to work and who are they for — surely not the traditional AMEX customer, nor the person who has financial trouble and needs something steady and reliable — it makes me think it’s more of a curio than a service.

  • Guilty until proven innocent in ChexSystems, this was my only alternative after 3 years of painstaking prepaid card usage. Now, having my mother try to load my account with her’s (My paycheck deposits in her account because of my inability to get an account – see, chexsystems) BlueBird CS Reps simply tell me this violates their terms of service and my account is locked for ID Security purposes (despite having the account owner ON THE SAME LINE WITH ME VIA PHONE). If you only knew the feeling of being this close to having an account after being blacklisted for fraud (was a bank mistake and am still fighting it, was cleared by a police investigator), you would know my hatred for the management of their customer service.

    Oh, just some fun facts about me. I would have funneled >$80k through this account annually, I am an AmEx Corporate Customer with a no-limit credit card. I am not an Identity Thief, never have been, and am a wonderful case study about how corrupt this little underbelly of ‘Credit Reporting’ is.

    • Thanks for sharing your experience! I feel for you. I know the ChexSystem can be nefarious with no easy way out for people to prove what the system says happened never happened.

      Please keep us up to date on exactly what happens with this! There must be a way out.

      I do think ChexSystem only tracks this sort of stuff for 5 years and then you roll out of the database. At least that’s how it used to work a few years ago. Is it the same way now?

      Have you tried to get help in the My FICO forums? They have really great expert insight and advice there.

  • I have been having the same problem with the slow transaction of funds, and the transaction is coming straight from my bank account! I keep hoping one of these days my money arrives on my card only to be used on gas because I used all of my actual “in-hand” money to buy stuff that I need, college books, supplies, etc. and that stuff isn’t cheap! I’m currently stuck with the money withdrawn from my bank account and it hasn’t yet deposited onto my serve card. So i’m stuck with this money floating around in the system not being able to be used, especially when I’m here with less than a quarter tank of gas left in the car to last me 4 days till my next paycheck. Let’s be honest, I’m broke at the moment and these cards are no convenience to anyone, maybe for people who have a hard time not spending money. I’m getting rid of my card as soon as the money is gone off of it. I have no time for this and I think most of you are probably feeling the same way with the difficulties this card contains.

    • Thanks for sharing your experience, Matthew!

      I feel for you — having your money delayed on purpose is never any good — but that’s how the banking machine makes money off of you… by holding your funds a few extra days to earn them interest.

      You’re likely going to be much happier with a more standard approach to managing your money, and we wish you all the best luck!

  • I’m trying to close out my BlueBird account right now and it’s like pulling teeth. After 25 minutes the rep said my account is now being reviewed!!!!! Are you kidding me? I’m trying to close it.

    I used the card 3 or 4 times at Redbox and it would be accepted then Redbox would say they never were paid so I had to pay Redbox with another card.

    I only wanted to close the Amex BB account because they are coming out with a Serve card with some nice features but I’m not going to bother with that because they appear to be completely incompetent.

    Really, their customer service is the absolute worst I have ever experienced in my entire life. They are reading off a script and don’t understand English.

    Really when I see someone say they are not having any issues with it I wonder how it can be so bad for some people and apparently decent for others.

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