Another day, another settlement…
Wells Fargo & Co has agreed to pay $50 million to settle a racketeering lawsuit accusing it of overcharging hundreds of thousands of homeowners for appraisals ordered after they defaulted on their mortgage loans.
The proposed settlement, which requires court approval, was disclosed in a filing on Friday in an Oakland, California federal court. If approved, it will resolve nationwide claims that Wells Fargo charged much more than it paid for third-party appraisals, exploiting borrowers who could least afford it and driving them further into default.
Wells Fargo’s settlement of the lawsuit comes as the bank is still recoiling from a scandal over sales targets that drove employees to create unauthorized accounts for customers. Multiple lawsuits over those practices are pending.
Spokesman Tom Goyda said Wells Fargo believes its appraisal practices were proper and disagreed with the lawsuit’s claims but settled to avoid further litigation.