Banking Blog

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Last week, Dealbreaker published a photo of a bank ATM receipt for a $400 withdrawal tossed on the ground outside a Capital One Bank in East Hampton, N.Y. So what made the receipt newsworthy? Other than a savings account balance of nearly $100 million, not much.

Dealbreaker alleged hedge-fund manager David Tepper was the lucky owner of the account, but he denied it, telling the New York Post, "I would never do something as irresponsible as leaving $100 million in a savings account."

Tepper's got a point. The fact remains someone out there is holding $99,864,731.94 in a savings account, likely earning a negligible amount of interest on that amount and making a mockery of personal finance conventional wisdom about asset allocation.

But it's also likely that the account holder in question is taking a huge financial risk along with what's probably a tiny reward. That's because, barring some sort of special arrangement, approximately $99,614,731 is at risk should Capital One Bank fail, because the FDIC only insures $250,000 per account holder, per institution. In effect, the account holder is making a massive bet on the safety and soundness of Capital One, for an annual return of probably 2 percent if he or she is lucky.

This illustrates a couple of points. One, having a bunch of money doesn't automatically make one savvy when it comes to managing it. Or as my dad used to put it, "It's possible to have more money than sense."

I hear this all the time when interviewing financial advisers. Many of their clients have incomes well into the six-digit range, but can't seem to stop overdrawing their checking accounts or failing to save for retirement. Just because someone has a special in-demand skill in one area of human endeavor that allows them to rack up millions or billions of dollars in assets doesn't mean they're good at managing it personally or finding a trustworthy person to manage it. One only has to take a cursory look at the list of Bernie Madoff victims or the aftermath of many a famed athletic career to see this is true.

The second point is, an ATM receipt can illuminate an awful lot about a person's financial life. So if you don't want the whole Internet judging your $100 million savings account, you may want to tear up that receipt on the way out.

What does your ATM receipt say about you?