Wells Fargo opened 2 million unauthorized accounts and now the customers, whose names were used to open those accounts, have filed a class-action lawsuit against the bank. A majority of the victims of this scam were already customers of the bank. Because of this, they are under contract with the bank and won’t be able to file a lawsuit against it.
Wednesday, the bank went to U.S. District Court of Utah where the lawsuit was filed and asked for it to be dropped. Wells Fargo did this in hopes of settling whatever qualms the customers have behind the closed doors of arbitration rather than in open court. Financial companies often hide stipulations in the fine print of the agreement that customers sign, and these stipulations will lead to the customer filing arbitration.
The fine print of an agreement is a perfect place for a company to hide their misdeeds. These forced arbitration agreements keep the company’s controversial actions tucked into small mediation rather than exposing them in public court documents.
The Wells Fargo scandal has not only brought about public outrage but caused longtime CEO John Stumpf to retire. Angered politicians requested the bank waive the arbitration clauses against customers so the people will be able to seek compensation for their claims of wrongdoing done by the fake accounts.
Wells Fargo responded saying it “believes that the use of arbitration is a fair and efficient process that serves the needs of both parties.” A big sign that the bank will continue to force arbitration clause on its customers. During the World Series, the bank launched an ad campaign in an attempt to convince viewers of its good intentions.
This scandal was also addressed by Hillary Clinton during the presidential campaign. She stated that “we can’t let corporations like Wells Fargo use these fine print ‘gotchas’ to escape accountability,” and said she would request for Congress to put an end to companies using arbitration clauses. Donald Trump has yet to make a statement on his estimation of the scandal.
Wells Fargo claims it is “working hard to rebuild trust in our company” and will exhaust “every attempt” at reconciliation before attempting arbitration. This attempt includes “fast and free” mediation to its customers and no use of a third-party.
Their slogan, “Wells Fargo is making changes to make everything right,” which was used during the World Series ad campaign, doesn’t seem to apply to this situation. Zane Christensen, representing customers in this class action suit, stated that “Wells Fargo isn’t concerned about making things right with their customers. Wells Fargo is worried about making things right in public relations.”
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