Keller Rohrback Continues to Investigate Wells Fargo Auto Loan Insurance Practices
August 8, 2017
Keller Rohrback L.L.P., the firm that filed the first class action on behalf of consumers in the Wells Fargo fake account scandal which resulted in a $142 million settlement, is investigating deceptive insurance practices by Wells Fargo’s auto loan unit, Wells Fargo Dealer Services. Less than two weeks after the New York Times first reported that Wells Fargo was charging auto loan customers for unnecessary collateral protection insurance (CPI), Wells Fargo is again under scrutiny for reportedly failing to properly refund guaranteed asset protection (GAP) insurance.
Wells Fargo has admitted that it placed unnecessary CPI on auto loan borrowers’ accounts, which reportedly resulted in hundreds of thousands of customers going into delinquency on their loans, and over 20,000 customers losing their vehicles to repossession. Lawmakers have since called for Congressional hearings on these practices, and New York state financial regulators served subpoenas on two Wells Fargo units and the insurance company that underwrote the unnecessary policies, National General Insurance Company.
In addition, regulators are now examining Wells Fargo’s GAP insurance practices. In its earnings report on August 4, Wells Fargo acknowledged that it had “identified certain issues related to the unused portion of guaranteed auto protection waiver or insurance agreements,” and that these “may result in refunds to customers in certain states.” The Federal Reserve Bank of San Francisco has opened an inquiry into these practices.
“This latest Wells Fargo scandal about GAP insurance centers around whether Wells Fargo has been refunding insurance money owed to people who paid off their car loans early,” explained Gretchen Freeman Cappio, partner at Keller Rohrback L.L.P. “Unfortunately, there seems to be no end to Wells Fargo’s creativity when it comes to scamming its customers.”
On July 31, 2017, Keller Rohrback filed a class action lawsuit against Wells Fargo & Company (NYSE: WFC) in the United States District Court for the Northern District of California alleging that Wells Fargo victimized its customers by charging them for auto insurance that they did not need, charging interest on the unnecessary insurance premiums, and aggressively pursuing collection of the “debt” that resulted when some customers did not pay these unwarranted fees.
Keller Rohrback’s complaint, filed on behalf of Wells Fargo auto loan borrowers nationwide, includes detailed allegations about Wells Fargo’s illegal practices and the significant stress, hardship, and financial losses that it caused its customers. “Wells Fargo, while vowing to ‘make things right’ in the wake of its recent scandal over unauthorized bank accounts, was apparently hoping this unlawful practice could slip by unnoticed,” the complaint says.
Keller Rohrback continues to investigate Wells Fargo’s unlawful auto loan insurance practices, including CPI and GAP insurance. If you are concerned that you had unneeded auto insurance placed on your auto loan account, or that you did not receive a GAP insurance refund after paying off your car loan early, please contact attorney Gretchen Freeman Cappio at (800) 776-6044 or via email at .
The case is Preston v. Wells Fargo & Company and Wells Fargo Bank, N.A., d/b/a Wells Fargo Dealer Services, in the Northern District of California.