Wells Fargo fac­ing suits, mad law­mak­ers

The Denver Post - - BUSINESS - By Ken Sweet

NEW YORK» The heat on Wells Fargo over its auto lend­ing business has in­ten­si­fied, with cus­tomers fil­ing at least three law­suits, politi­cians call­ing for hear­ings and a bank reg­u­la­tor is­su­ing a sub­poena for records.

Wells Fargo, still try­ing to re­cover from a fake ac­counts scan­dal, said last week that roughly 570,000 cus­tomers were signed up for and billed for car in­sur­ance that they didn’t need or nec­es­sar­ily know about. Many couldn’t af­ford the ex­tra costs and fell be­hind in their pay­ments. In about 20,000 cases, cars were re­pos­sessed.

The bank has agreed to pay $80 mil­lion in re­funds and ac­count ad­just­ments to cus­tomers, with checks start­ing to go out this month.

But on Wed­nes­day, the New York Depart­ment of Fi­nan­cial Ser­vices sent a sub­poena to Wells Fargo.

It wants to see copies of loan con­tracts with bor­row­ers, agree­ments with its dealer net­work, and any out­side ven­dors who may have played a role.

That fol­lows two cus­tomer law­suits filed in Cal­i­for­nia and one in New York.

The bank, along with be­ing one of the na­tion’s largest re­tail bank­ing chains, is also one of the largest auto loan com­pa­nies with a net­work of 14,000 deal­er­ships.

Politi­cians are also an­gry with Wells Fargo, with Democrats in the House and the Se­nate call­ing for a Con­gres­sional in­ves­ti­ga­tion.

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