Any worries having a lot of money in online banks with no paper trails?

I mean, what were to happen if there was either a computer glitch or some catastrophic event to the bank’s hard drives such that the records of your deposits or balance were wiped out or scrambled? I have quite a few accounts opened years ago from banks that I don’t have a single piece of paper to prove I even have an account there.

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Download copies of your statements. Print them out if you want a paper copy.


That would really be just my word against the banks if something catastrophic happens at the bank. Pretty easy to Photoshop a statement with whatever numbers you want.

Then I don’t know what option there is, other than getting paper statements, if the banks offer that. If you’re that concerned, ask the banks how they protect the records.

For my records, I keep PDF copies of my statements. I back them up to a cloud drive.

Most financial institutions mirror transactions on geographically diverse servers in near real time, so there is minimal risk of a computer glitch erasing transactions or accounts. Smaller banks/credit unions/brokerages will hire a 3rd party with the technological infrastructure to do this (example: Fiserv). If they weren’t doing it before 9/11, they certainly implemented it afterwards. Source: used to work in IT at a regional bank.


So if a glitch changes your balance from $100,000 to $10,000, won’t the transaction mirror the glitch on geographically diverse servers in near real time just the same?

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1099s are also proof that you have/had an account, since that info may be reported to the IRS if the income meets the reporting threshold.

I’ve never worked in a bank, but I used to work in accounting. Numbers have to balance. If $90,000 of an account balance was wiped out on the customer end, wouldn’t the bank show an overage of $90,000 on their end? A customer that could provide a statement showing $100,000 pre-glitch vs. $10,000 post-glitch might have a good case, especially if the bank couldn’t provide records of $90,000 worth of transactions reducing the balance.

The bank also wouldn’t be the only party with the record of deposits. The source of the deposits would also have records showing that deposits were made to your account. It would be pretty hard, I’d think, for the bank to claim you never had an account there.

Maybe not literal paper trails, but many electronic trails.


Probably, but there would be a log somewhere showing the balance changed and who or what changed it. It would raise red flags if there was no corresponding transaction. It would also raise flags that $90k appeared out of nowhere somewhere else. IT/investigative accountant could look at a daily/weekly/monthly backup and see that the account balance changed and track down the discrepancy.


I wouldn’t be worried about the bank trying to screw me by suddenly shorting my account (not that you shouldn’t check for errors from time to time, since those happen especially if you’re doing a lot of transactions). I would be more worried in the situation you describe that my spouse or heirs might have a big PITA finding and unwinding everything if I were to get hit by a beer truck tomorrow. For that reason, I’d try to keep a record of my accounts either in paper or electronically myself on hand just for my own sake.


In addition to everything stated above, the technical implementation for bank transactions should be using a time-series or temporal database, with auditing / journaling capability. It should not be possible for something like this to happen by accident. In practice I think it would be extremely challenging (expensive and time-consuming) technologically (say by hackers) to attempt to alter temporal records, journals, and backups. I suppose nothing is impossible, but this should be pretty close to it.


OK but isn’t this database created and stored electronically on hard drives memory chips or mag tape? Can’t imagine they would print out a daily log of all transactions of each account. I’m thinking of an event somewhere between a simple bank error and something apocalyptic. Something perhaps system wide at the bank that may alter or erase all accounts and their backups, but not to the level of a gamma ray burst that would erase all the hard drives on the planet.

No, I don’t think there’s enough ink and paper in the world to print out a daily log of transactions. But for data stored on hard drives there are multiple redundancies to make this nearly impossible, especially accidentally. I think it would have to be very deliberate and very sophisticated (and most likely an inside job).

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In addition to all other responses, the fact that the bank is an online bank in and of itself isn’t particularly relevant. The fact that a bank has a physical retail location doesn’t make it less susceptible to what you describe.


Now if someone wiped out IRS computers that we could enjoy.

That would be a huge wealth distribution from the poor to the rich, because poor people get tax refunds and upper middle class and wealthy people wait until the last minute to pay them (sometimes on a CC for reward points).

You mean every Bank of America branch around the country doesn’t have a backroom with paper records from all of their customers?


The problem of your death or incapacity should worry you.

Locating accounts has always been a problem for heirs, but to recently it could be done by reading mail with statements, and if need be going to a small number of local banks and inquiring. Now there are hundred of places someone could have accounts with and contracting all of them would be impractical. If I did not have records, I could imagine accounts with thousands to millions not being found.

One should make a list and leave copies with wives and relatives, remembering a house fire or flood may destroy many records. I was flooded out by Katrina and lost both computers and paper records.

The sums involved may be less but one could lose track of debts owed (credit cards with obscure credit unions), or points with hotel and airline programs. I could imagine collection agencies showing up after months of payments were missed due to death or incapacity.


Well you can always login to those online banks and print out a statement so that you’ll have a current piece of paper

Even online banks have fdic insurance so there’s no need to be concerned with a hack or some other calamity wiping out any trace of your account

As others said its good to keep a list of your accounts with account numbers and rough balances for your heirs should you become injured or die . It would also come in handy if you did need to reference your account number to the fdic , but typically fdic takeovers have been seamless


Sounds like somebody just started watching Mr. Robot :space_invader:

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