Wells Fargo Facing Auto Insurance Scheme Class Action Lawsuit

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Santa Clara, CA: Wells Fargo & Co is facing a consumer fraud class action lawsuit brought by customers who allege the bank forced them into paying for unnecessary auto insurance, which, in some cases, drove customers so far into a financial difficulty their vehicles were repossessed.

According to the proposed nationwide class action, the bank fraudulently collected millions of dollars from “unsuspecting customers who were forced to pay for auto insurance they did not need or want,’’ pushing almost 250,000 of them into delinquency and resulting in almost 25,000 vehicle repossessions.

Filed by Indianapolis consumer, Paul Hancock, the lawsuit claims Wells Fargo received kickbacks from National General Holdings Corp., through shared commissions on the policies. According to The New York Times, Wells Fargo stopped sharing in commissions from the insurance sales in February 2013.

According to the allegations, when customers took out Wells Fargo loans to purchase vehicles, the bank and the insurance company either didn’t check whether clients already had coverage or ignored the information. The bank then created collateral protection insurance policies for customers, and Wells Fargo then added premium charges to customers’ auto loan bills, often without notifying them, according to the lawsuit.

According to Bloomberg, Wells Fargo has said it may have pushed thousands of car buyers into loan defaults and repossessions by charging them for the unwanted insurance. The bank said an internal review of its auto lending found more than 500,000 clients may have unwittingly paid for protection against vehicle loss or damage while making monthly loan payments, even though many drivers already had their own policies.”

Wells Fargo discontinued the insurance program in September 2016 after finding errors. Hancock alleges Wells Fargo placed a CPI loan on a vehicle he bought in February 2016, charging him $598. Hancock “repeatedly contacted Wells Fargo to inform them that he had the required insurance through an auto insurance policy from Allstate,’’ according to the complaint.

Not only did Wells Fargo fail to credit Hancock’s account for the improper charge, they also failed to refund the money. In fact, Wells Fargo kept charging him for the policy and he was charged a late fee, Hancock claims.

Hancock seeks restitution, disgorgement of all profits and three times damages incurred by all plaintiffs. The lawsuit is Hancock v. Wells Fargo & Co., 17-cv-04324, U.S. District Court, Northern District of California (San Francisco). Hancock is represented by Roland Tellis of Baron Budd.

Wells Fargo Auto Insurance Scheme Class Action Legal Help

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Last updated August 4 2017

Reader Comments

Posted by
LuLu323
on
I too was bullied into that fraudulent auto insurance scheme when I took a title loan out for my vehicle back in 2008. I told Wells Fargo I already had sufficient auto insurance through Farmers in California, and they still ignored me and added their ratchet auto coverage to my monthly statements. And yes it did cause extreme hardship to pay the bill monthly, along with added late fees when I missed the due date,( plus I continued paying for my auto insurance through Farmers!) I made 54 payments to them with boosted added charges. I would absolutely love reparations for this horrific abuse.

Posted by
LuLu323
on
I too was bullied into that fraudulent auto insurance scheme when I took a title loan out for my vehicle back in 2008. I told Wells Fargo I already had sufficient auto insurance through Farmers in California, and they still ignored me and added their ratchet auto coverage to my monthly statements. And yes it did cause extreme hardship to pay the bill monthly, along with added late fees when I missed the due date,( plus I continued paying for my auto insurance through Farmers!) I made 54 payments to them with boosted added charges. I would absolutely love reparations for this horrific abuse.

Posted by
Gary Hall
on
I feel I am one of these cosumers that was taken advantage of in this case. What should I do?

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