Wells Fargo in Hot Water …Again.
Wells Fargo in Hot Water…Again.
You may have seen it. Watching a sporting event, maybe just aimlessly surfing channels to kill some time. Wells Fargo’s new commercial, it does something, it just pulls at your heartstrings. Maybe it’s the appeal to history, maybe it’s the horses, or maybe it’s the idea of a comeback story. Whatever it is, it has likely grabbed your attention. When Wells Fargo says it “knows the value of trust” and although Wells Fargo lost its way, that’s not where the story ends, rather, it’s where the story starts again—a complete recommitment to the consumer and re-birth of the company circa 2018.
The bank has been embroiled in scandal for the better part of the last decade. Of one of its most infamous corporate policy blunders in recent memory, is the sales goals incentives to branch bankers which encouraged a culture of competition, which in most instances, is commendable, but in this instance, resulted in bankers creating over 2 million fake checking accounts in order to earn sales bonuses. In 2016 the CFPB and Office of the Comptroller of Currency fined the bank $150 million for these antics. The bank paid out $480 million to shareholders to settle a class action suit over the bank’s fake account scandal. Beyond that, the bank was also fined by the CFPB in April in the amount of $1 billion for forced placed auto insurance and mortgage abuses, and also $108 million to the federal government to settle allegations that the bank overcharged military veterans for refinances.
Well, now that all of those scandals are behind them, and Wells Fargo has made a public declaration that it is recommitting itself to integrity in order to reestablish consumer trust, we can rest easy that there really should not be any more latent scandals resurfacing, right? Wrong. Just this month, on August 3, 2018, Wells Fargo revealed that due to a software glitch in its system, it denied over 600 consumers mortgagors mortgage modifications that they were rightfully entitled to. Of the 600+ modification denials, 400 ultimately resulted in foreclosure. Yes, that’s correct, Wells Fargo denied mortgage modification attempts submitted by homeowners trying to save their homes because they “screwed up.”
Many studies have revealed that one of the most stressful things a person can experience in their lives is to go through the moving process. To be forcibly removed from one’s home, has to exponentially increase that life stressor to near the top of the list of most stressful. What is Wells Fargo doing to remediate the newest scandal? It has set aside $8 million during the second quarter of 2018 to pay customers who may have been affected by the wrongful modification denials. Generous, right? No, not really. Divided by 600 affected customers, that equates to little over $13,000 per customer. Would you accept $13,000.00 if you lost your home as a result of bank misconduct? I would think not.
While Wells Fargo attempts to rebrand itself as a banking institution for the people, consumers need to ensure that their interests are protected by hiring a qualified consumer rights and/or foreclosure defense attorney. If you or anyone you know is going through foreclosure or is about to enter foreclosure, please encourage them to reach out to an attorney to discuss their case.