Wells Fargo Deceptively Passed Delay Fees onto Mortgage Loan Customers, Lawsuit Claims

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A proposed class action filed against Wells Fargo & Co., Wells Fargo Bank, N.A. and Wells Fargo Home Mortgage seeks to address what it calls the “third in a series of fraudulent business practices” the bank has allegedly inflicted upon customers. Citing scandals from 2016 and 2017 that, respectively, saw customers have phony accounts opened in their names and unnecessary car insurance forced upon them—acts supposedly stemming from a culture of too-lofty sales and performance goals for employees—the 18-page lawsuit claims Wells Fargo workers deceived mortgage loan applicants by promising a locked-in interest rate for a set period of time—usually 60 days—with a fee being levied onto borrowers should they be found at fault for delaying the application process.

According to the lawsuit, if Wells Fargo took longer than 60 days to process customers’ mortgage applications, the bank itself was to pay the fee associated with extending the locked-in interest rate. The plaintiff, a New Jersey resident, claims Wells Fargo’s hyper-competitive sales and corporate culture once again reared its head, leaving proposed class members holding the bill. From the lawsuit (emphasis ours): 

The lawsuit goes on to claim a number of former Wells Fargo employees, in a whistleblower complaint submitted to Congress and in media interviews, revealed that the bank had wrongfully placed blame for mortgage application delays on customers rather than take responsibility and pay millions in interest rate extension fees.