By on August 11, 2017

wells fargo

California’s insurance regulators have launched an investigation into Wells Fargo following the bank’s confession that it forced hundreds of thousands of auto loan borrowers to pay for insurance policies they didn’t need and, in many cases, were unaware of.

There’s also a congressional investigation underway, where U.S. senators are asking the company basic questions like who was affected, how broadly, whether they get a refund, and why the hell this occurred in the first place.

Unlike JPMorgan Chase or Bank of America, Wells Fargo’s auto loan contracts allowed the lender to obtain collateral protection insurance on a customer’s behalf if they failed to buy liability coverage themselves — or if the bank assumed they hadn’t. It’s not common practice and, when it causes paying customers to default and have their vehicle repossessed, it’s not difficult to see why.  (Read More…)

By on July 28, 2017

Wells Fargo, Mike Mozart/Flickr (CC BY 2.0)

Wells Fargo says it will reimburse roughly $80 million to customers erroneously charged for auto collateral protection insurance policies. Customers will be remediated after roughly 800,000 customers were essentially forced to purchase unnecessary auto insurance, despite many of them already having active policies.

The banking and financial services firm reviewed policies started between 2012 and 2017 and identified approximately 570,000 customers who could have been negatively impacted. It plans to issue refunds and other payments as compensation, especially to those who defaulted on their auto loans as a result of being overcharged.  (Read More…)

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