In a class action lawsuit, around a million Wells Fargo customers from California accused Wells Fargo of “imposing excessive overdraft fees on checking account customers.”
On Tuesday, U.S. District Judge William Alsup sided with the consumers. He stated, “the fourth-largest U.S. bank violated a California law that protects consumers against fraudulent misrepresentations” and ordered Wells Fargo to pay $203 million to settle class action litigation.
How Did Wells Fargo Mislead Its Customers?
According to Judge Alsup, Wells Fargo Bank misled consumers regarding their overdraft fee practices by doing the following:
- “Affirmatively misleading the class" as to its practice
- “Engaging in a practice likely to mislead the class to believe that processing would be done in chronological order”
- Subjecting Wells Fargo customers to unexpected charges
This ruling obviously isn’t sitting too well with many Wells Fargo banks. According to NBC News, “the San Francisco-based bank plans to appeal” the ruling.
What is Fraudulent Misrepresentation?
Fraud occurs when one intentionally deceives another. It can be filed as either a civil or criminal claim. Therefore, the fines for fraud can be monetary as well as punitive.
For more information about the lawsuit, you can search the case online. The name of the case is Gutierrez et al v. Wells Fargo Bank NA, U.S. District Court, Northern District of California, No. 07-05923.
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