First Wells Fargo opened millions of accounts that customers didn't want. Now, in what one consumer advocate calls a "colossal failure of management," the company has admitted it signed up hundreds of thousands of customers for auto insurance they didn't need, NPR reports.


And that unrequested insurance, when it lapsed, marred credit scores and resulted in about 20,000 car repossessions. In New York, subpoenas have been issued to two Wells Fargo units by the state's banking and insurance regulator, demanding they hand over financing and insurance contracts, as well as information on how and when the bank started learning people had complaints, per Reuters.

It all revolves around collateral protection insurance (CPI), which lenders sometimes mandate on loans when a customer doesn't have insurance. But most of these customers did have their own insurance, which the company notes in a press release, saying it will send refunds and make account adjustments worth about $80 million.

Wells Fargo says it will also help customers fix credit scores with credit bureaus, and that about 570,000 customers were affected in some way; a New York Times report puts affected customer numbers much higher (800,000 or so), noting Wells Fargo "took issue" with some figures in a consulting firm report it requested.

The bank says this wasn't a nefarious scheme, but simply CPI program mismanagement. "We take full responsibility for our failure," says the head of the bank's Consumer Lending division.

"I felt like they're crooks," one customer tells NPR after discovering his missing car wasn't stolen but repossessed; he apparently owed $1,500 in CPI payments that he didn't need or know about.

Link

Yeah, usually it's the other way around, the Stagecoach gets robbed!

Jeez, they suck. Glad my auto loans are through USAA.

quote:

Originally posted by Sailor1911:
Yeah, usually it's the other way around, the Stagecoach gets robbed!

Ha! Wells Fargo and Bank of America are two that I steer far, far away from. Systematic marginalization of the consumer to bolster the bottom line.

This was reported back in July? Or did it happen again?

As mentioned above, it is stealing. There are laws against stealing and criminal penalties... so, who is being charged?

Moreover, who is going to jail? I think theft of over $1000 is Grand Larceny.

Haul a dozen senior managers and most of the branch managers to the hoosegow and that will stop that crap!!

B of A tried to take my house. I was 14 years AHEAD on payments and owed 2k. The final resolution, after about 50 hours on the phone and letter writing, was "oops." They had my account number off by a digit. They settled by releasing my loan and with a letter acknowledging the error, forwarded to me, the credit reporting folks, and the local sheriff. Yeah, it went that far.

They bought First Union where I had my house loan and I used First Union anytime I needed something notarized.

Walk in there now and you would think you are in a 3rd world country and they are not even friendly plus they will not do a notarization. Some of them also speak broken English. And yes, there are Injun's working in the bank.

Why are WF's actions not criminal, and why aren't any of them crooks in jail?

Seems like jail time is very appropriate in this case. As well as a mass exodus of customers

quote:

Originally posted by ScorpionBoy:
This was reported back in July? Or did it happen again?

The date on the article is Aug. 3.

quote:

Originally posted by 12131:
Why are WF's actions not criminal, and why aren't any of them crooks in jail?

... perhaps it has something to do with money????

People should go to jail for this.

Dig a little deeper and you will find out that most of these people did not respond to numerous requests by WF to update their ins. info. Therefore, WF had no choice but assume they dd not have ins and purchased it for them at a higher rate than was alloted for in their automatic drafts, thus getting further and further behind in their principal payments, triggering the repos. Dont believe everything you read in the media, they want the banks to fail.

quote:

Originally posted by imfrogman:
Dig a little deeper and you will find out that most of these people did not respond to numerous requests by WF to update their ins. info. Therefore, WF had no choice but assume they dd not have ins and purchased it for them at a higher rate than was alloted for in their automatic drafts, thus getting further and further behind in their principal payments, triggering the repos. Dont believe everything you read in the media, they want the banks to fail.

Well, I believe almost nothing I see in the media, being the suspicious, cynical and mistrustful person I have become after ~40 years of lawyering, but this seems sincere:

“The bank says this wasn't a nefarious scheme, but simply CPI program mismanagement. "We take full responsibility for our failure," says the head of the bank's Consumer Lending division.” That sounds lke an admission to me.

Why would the media want the banks to fail?

I want a couple of them to fail, I hasten to confess, WF being at the top of my list.

My experience with WF is that if they failed is so what? Customer service means nothing to them.

Kind of ironic. Up here Michigan National Bank was bought out by Standard Federal, it turn it was sold off to LaSalle Bank. LaSalle sold out to Bank Of America.

Michigan National's mortgage division, Independence One Mortgage was acquired by Norwest Bank. Norwest was acquired by Wells Fargo Mortgage.

Each time either company changed hands, customer service dropped. Have nothing to do with either of the two.