If you have one of three Wells Fargo accounts, you might be eligible for a payment after the bank broke federal consumer protection laws through “illegal” practices in handling bank accounts and other financial products.
A settlement with Wells Fargo was reached, a blog post from the Consumer Financial Protection Bureau from January 17, 2023 said, after the bureau discovered that the bank’s “illegal practices, including incorrect fees and interest charges, misapplied payments, and wrongful foreclosures” that affected more than 16 million of its customers’ accounts.
The same blog post said the total compensation is $3.7 billion, which includes a fine of $1.7 billion that is explicitly allocated to a fund for the victims’ assistance.
Customers With Three Types Of Accounts Are Impacted
Customers who owned one of the following accounts between 2011 and 2022 were affected, CFPB said. Here is a breakdown of the impact on each account.
Customers have occasionally received unexpected overdraft penalties for ATM withdrawals and debit transactions, even though there was sufficient funds in their account at the time.
Some clients received false and unfair monthly fee charges.
If Wells Fargo believed a deposit was fraudulent, it unfairly “froze” specific clients’ money for weeks.
Auto Loan Clients
Some accounts’ auto loan payments were not correctly applied to the balances, resulting in late fines, erroneous and poorly handled repossessions, and increased interest rates.
When borrowers who paid for GAP coverage had their loans prematurely terminated, Wells Fargo failed to reimburse their money correctly.
Mortgage Loan Clients
To avoid foreclosure, several homeowners who requested loan modifications were wrongfully denied.
Some borrowers received inaccurate fees or other charges.
Wells Fargo submitted “thousands of erroneous foreclosure cases,” falsely labeled some clients as deceased, exaggerated attorney expenses, and mistakenly refused applications.
How to Claim Damages
Wells Fargo is supposed to let you know if you are qualified to receive money. Numerous clients have already received their money through checks or credits to their active accounts.
A company spokesperson tells CNBC Make It (via CNBC) that most of the customers who might have been impacted by the issues covered by the settlement have already received proactive communication from the bank, and those efforts are still ongoing.