We have known for months that banking giant Wells Fargo engaged in a systematic fraudulent scheme to open accounts for customers without their authorization in order to bring in higher rates of overdraft charges. Over 2 million accounts were opened in this manner by more than 5,300 employees of the bank, costing untold amounts of financial havoc, costs, and headaches for the many customers who entrusted the bank with their hard-earned funds. But, while this scheme became headline news in only the past year, media organizations have long been reporting that Wells Fargo employees had been attempting to alert authorities both within the bank and in the federal government for years about the practices, and had been retaliated against by the bank for trying to do the right thing. In recent weeks, the bank itself finally admitted that it did in fact retaliate against employees trying to play by the rules, and other news of fraudulent activities have also come to light, prompting Fortune magazine to recently declare, “The Wells Fargo Sancal is Now Reaching VW Proportions” (in reference to Volkswagen’s historic scandal in which it fraudulently engineered cars to avoid emissions testing).
The Bank Confesses to Retaliation
After months of intense government and media scrutiny (during which the bank’s CEO left the company with a $133 million payday), Wells Fargo worked with an outside consultant to review how it responded to employees who called the company’s internal hotline to report wrongdoing. Numerous such individuals were terminated the bank within a year of doing so, and the bank admitted that signs indicate that some of these employees were terminated as a result of their attempts at rectifying wrongdoing at the bank. Such action is referred to as “retaliation” and is illegal under state and federal law.
Wells Fargo Managers Were Tipped Off Prior to Inspections
In addition to the above admission, it now appears that branch managers with the bank also received tips prior to internal risk assessments and inspections. According to media reports, this helped facilitate the bank’s long-running fraud by giving time for managers and employees to shred incriminating documents and forge signatures on customer documents in order to make the fraudulently-opened accounts look legitimate.
Wells Fargo Reportedly Blamed Customers to Fraudulently Increase Fees
As if that were not already shocking enough, a new report from ProPublica indicates that Wells Fargo employees in the Los Angeles region fraudulently mishandled mortgage paperwork in order to prevent customers from receiving extensions on favorable interest rates to which they were entitled, which ended up costing the customers $1,000 to $1,500 apiece in “extension fees” assessed in response to the failure to meet deadlines, which were due to the bank not the customer.
The bank adopted a number of strategies in “attempting to transfer blame onto customers for past and expected future delays” in completing the paperwork, thus leading to the high, unnecessary and unwarranted fees. These strategies included flagging files for insufficient documentation where there was no problem and overloading customers with unnecessary paperwork to increase the chance of delay. According to employees, managers at the banks earned higher bonuses when customers paid the fees, thus motivating the scheme.
Seeking Justice for Customers Who Continue to Be Victimized by Wells Fargo
McCuneWright is an Inland Empire class action firm that successfully brought a 2010 class action against Wells Fargo, resulting in a $203 million recovery on behalf of California consumers victimized by the bank’s fraudulent practices. McCune Wright continues to seek justice on behalf of consumers who have been victimized by the bank’s illegal and fraudulent overdraft practices on ATM and debit card transactions.
If you have been charged overdraft fees on ATM or debit card transactions, and you have reason to suspect Wells Fargo employees failed to provide you with required information or obtain your consent to charge you overdraft program fees or were pressured to provide affirmative consent, McCuneWright is here to help determine whether you have a claim and to seek justice on your behalf. We look forward to helping you obtain the financial recovery you may be owed. Contact our office today at 909.572.8019 or take a few minutes to fill out the online form located here.