A former manager of a local Wells Fargo Bank branch accused the lender of forcing her out after she refused to go along with the illegal sales practices that cost the bank $185 million in regulatory fines last year, according to a new lawsuit.
Rachael DeBoy of Cibolo seeks as much as $1 million in damages from the San Francisco-based institution, saying she resigned in 2013 to avoid termination because of her inability to reach the bank’s “fraudulent sales goals.”
DeBoy said she refused to go along with “unethical company practices” reinforced by a manager who was filling in for her while she was on maternity leave.
Wells Fargo & Co. has lost “tens of millions of dollars” in revenue from municipal and state clients since a sales scandal in its consumer bank erupted 10 months ago, Chief Financial Officer John Shrewsberry said.
Shrewsberry said the decline isn’t material to Wells Fargo’s earnings, but added the company is working to regain the business. Ancel Martinez, a spokesman for the San Francisco-based lender, said the lost revenue is expected to be $20 million to $30 million for 2017.
“I don’t want to downplay it,” Shrewsberry said Friday in a telephone interview. “If we’ve irritated those customers, we want to compete and demonstrate to them how we’ve made things better and win their business back.”
(Reuters) – Wells Fargo is poised to eliminate a number of its smaller businesses, the company’s chief financial officer said in an article published Sunday.
The Financial Times reported that Wells Fargo will be spinning off a number of its products “worth hundreds of millions of dollars,” according to CFO John Shrewsberry, in order to focus on and emphasize “more relevant” ones, though he did not specify what products those would be.
“There are a handful of businesses in our mindset,” Shrewsberry said, adding that the bank had “choices to make.” “They’re not at the scale of most of our businesses . . . not top-tier providers.”
As Wells Fargo & Co. continues to be hit with fallout from its sham-accounts scandal, the bank is facing allegations that it put the screws to customers in yet another way: by slapping them with fees for delays in processing mortgage applications.
A former Wells Fargo mortgage banker who worked in Beverly Hills alleged in a lawsuit this week that the bank falsified records so it could blame holdups on borrowers — and that it fired him for trying to report the practice.
The legal action follows a months-long internal investigation into the alleged abusive practices, one that contributed to an executive shake-up in the San Francisco bank’s mortgage business. ProPublica first reported on the alleged improper fees in January.
When borrowers apply for a mortgage, they are typically guaranteed a set interest rate — assuming the loan is approved within a certain time frame, often 30 to 45 days. If approval takes longer, the borrower can still get the promised rate but there are financing costs associated with extending the guarantee.
The Gaston County homeowners who have filed a class-action lawsuit against Wells Fargo are asking a judge in Charlotte this month to stop the bank from making alleged loan changes without borrower approval.
The suit filed in June by Christopher and Allison Cotton gained national attention over its allegations that the San Francisco-based bank was making “stealth modifications” that could vastly increase homeowners’ borrowing costs.
The complaint was another black eye for the bank as it tries to recover from a major scandal over its consumer banking sales practices.
Lawyers for the Cottons, who live in Dallas, N.C., filed a motion for a preliminary injunction last week against the practices outlined in their suit. The request applies to all Wells Fargo borrowers nationwide who have filed Chapter 13 bankruptcy cases. A hearing is scheduled for July 26 in federal bankruptcy court in Charlotte.
“We want to make sure that no one gets taken advantage of because of these practices,” said Theodore Bartholow III, a Texas-based attorney who is among the lawyers representing the Cottons.
An Easton man and the bank that was foreclosing on his home reached a settlement in a dispute that arose when the man alleged his belongings were stolen by workers sent to secure the property.
John Barber sued Wells Fargo, alleging “his home had been broken into, the locks changed, the premises ransacked, and a large quantity of personal property belonging to him was missing.”
He told me there was no reason to secure the premises because he still was living there at the time of the alleged theft in April 2014 and was preparing to sell the home at a short sale, which the bank had approved. The missing items included a coin collection and an antique firearm, according to the lawsuit.
(Reuters) – Several Pimco investment funds are accusing the mortgage-backed securities trustee Wells Fargo of misusing noteholder money to pay its own legal expenses.
In a newly filed complaint in Manhattan State Supreme Court, the Pimco funds are asking for a declaratory judgment that Wells Fargo is not entitled to use MBS trust money to fund its defense against noteholder claims that the bank breached its duties as an MBS trustee. Pimco’s lawyers at Bernstein Litowitz Berger & Grossmann allege that Wells Fargo has improperly reserved about $95 million across 20 MBS trusts.