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Sadly, mulch volcanoes are common practice in landscaping. These excess mounds of mulch piled up high against a tree's trunk can cause many issues for the tree or for other woody plants. The mulch locks moisture against the trunk, which wants to be dry. Over time, that bark will begin to rot, and pathogenic fungi, insects or other harmful pests have an easier time entering the tree. Mulch volcanoes can also lead to girdling roots and decrease structural strength of the tree at its base.
The best way to mulch is in a donut shape, making sure to leave the tree's root flare / trunk flare / root collar exposed to the air and above ground. If your tree has a mulch volcano, I recommend you remove it! :)
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Aren’t there issues with girdling roots as well?