Lawsuit: Wells Fargo Dealer Services, One Other Stole Millions in Unwanted Car Insurance

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A proposed class action filed in Mississippi alleges Wells Fargo Dealer Services and National General Insurance Company stole millions of dollars from consumers in “unwanted and unneeded” car insurance costs. The 24-page case slams Wells Fargo as “par for the course” in accepting full responsibility for and admitting to the fraud only after the New York Times outed the scheme when it obtained a leaked report commissioned by the bank itself. As for National General’s alleged role in the conspiracy, the lawsuit alleges the company “has kept its mouth shut, as it did for the previous 10 years of participating in—and benefitting from—the scheme.”

The complaint explains Wells Fargo lured in consumers for auto loans. Wells Fargo would then send their information on to National General, who would add on collateral protection insurance that the case says generated millions in fraudulent revenue. 

The complaint later shares some facts from the aforementioned internal report Wells Fargo commissioned from a consulting firm, including:

• Upward of 800,000 consumers “were charged, and paid for, auto insurance they didn’t need” and for which some consumers are still paying;
• 274,000 consumers fell into delinquency as a result of the scheme;
• 25,000 consumers had their vehicles wrongfully repossessed;
• In many cases, consumers were never told of the insurance before charges were deducted from their bank accounts.