Car Loan from Wells Fargo Equals Ripoff

dinosaur tracks outside in Red Gulch outside Greybull, Wyoming

Manderson, WY  Hey, I know you really want to hear about what Chaco and I are doing in Wyoming. You want to know all about the dinosaur tracks we saw in the Red Gulch. You want to know how we caught two cutthroat trout on Lake Sibley on lures when everyone else was fishing with worms. You want to know how volunteers are keeping the GeoScience Museum going in Greybull and about the Pyramid Rock in the Shell Canyon. Sorry, maybe another day, I was saving some of my fire on Wells Fargo so that we could just look at what happens to the poor suckers who made the mistake of getting a car loan from this banking version of a criminal enterprise.

dinosaur tracks outside in Red Gulch outside Greybull, Wyoming

They had a number of scams going.

The first had to do with forcing people to get collision insurance when they took out a car loan. Wells Fargo had a practice of doing so, and collision coverage is expensive. The bank determined that it had affected at least 800,000 customers according to an analysis they commissioned themselves. Some reports, including in the New York Times, indicated that the number of victims there could also be higher. Not that it wasn’t bad enough!

By larding on the insurance charges they forced at least 274,000 people, ostensibly customers they cared about and not simply marks in a con game, into delinquency, resulting in 25,000 cars being wrongly repossessed. The bank at last report was still debating how much they were going to pay in restitution.

GeoScience Museum in Greybull

I want you to just step back for a minute though. Big numbers sometimes conceal the individual pain inflicted on each individual victim. 274,000 is a lot of people, and could include friends, relatives, and neighbors living near you. They didn’t go out their front door, and yell that they were being ripped off by Wells Fargo. They probably sulked around thinking they had messed up somehow. Meanwhile their credit was crippled, so they could forget about paying lower interest elsewhere, trying to buy a home or maybe even getting an apartment they would like, and certainly buying another car in the future would be a mountain to climb. And, 25,000 of the cars were wrongly repossessed. I’m sorry to be so old school, but I think 25,000 is a big number of people to hurt as well! How many lost their jobs when they lost their transportation or were forced to move. To Wells Fargo, and perhaps to a lot of policy makers, these are just numbers and the penalty will hardly add up to a rounding error on their annual report and balance sheets, but these are real people who were seriously hurt. They weren’t rich people, but people who had to shrug it off and still try to live and raise families.

But, in the relentless quest for extra pennies regardless of the damage to people, it turns out that Wells Fargo also didn’t mind profiteering on some more insurance scams. This ripoff involved GAP or guaranteed asset protection insurance. As the Times reports:

It is not mandatory for car buyers to carry GAP insurance, which typically costs $400 to $600. But car dealers push the insurance, and lenders like it because of the protection it provides. When borrowers pay off the loans early, they are entitled to a refund of some of the GAP insurance premium because the coverage they paid for is no longer needed.

The Federal Reserve and others are now looking at how Wells Fargo closed the GAP to benefit themselves. When someone did their best to pay off their car loan early, Wells just kept the insurance money rather than refunding the balance as nine states require or crediting the unused insurance portion to balance as all fifty states require. Who knows how many were forced into delinquency or repossession by this scam.

Wells Fargo claims that its compliance and oversight slipped up. It’s fair to ask what compliance, is that the guy who closes the door when the bank executives decide in secret that they can steal some money from their customers without them knowing they are doing it?

If you believe that then I have a 20-year old Suburban that I’m glad to sell you for $50,000, and I know just the place that will give you a car loan if you want to add one ripoff to another: Wells Fargo!

Pyramid Rock in Shell Canyon


How Can Anyone Keep Their Money at Wells Fargo?

Manderson, WY   On Wyoming maps there are various stagecoach routes that are marked not far from the Silver Bullet’s location on the Bridger Trail. Stagecoaches, the Pony Express, and other ways of delivering the mail are so 1800s. Sadly, for some the only knowledge they may have of a stagecoach is the symbol still used by the banking giant Wells Fargo. If anyone was still manufacturing stagecoaches they would have solid grounds for a lawsuit against the bank for damaging their brand. As one story after another emerges from the gruesome bowels of the bank, I can’t help but wonder, how can anyone keep their money at Wells Fargo?

Just this week there were another handful of grim revelations by the bank.

Wells Fargo said in a regulatory filing that its review of potentially unauthorized accounts could reveal a “significant increase” in the number of accounts involved, up from the 2.1 million that it previously estimated. Wells Fargo said it had expanded its investigation to add three years to its review period, which covered accounts opened from 2011 to mid-2015. This scandal has engulfed the bank leading the fall of one chief executive already, the clawback of bonuses from the CEO and other executives, and, oh yeah, the firing of thousands who participated in schemes where they opened accounts without permission, often closing them quickly as well, in order to make sales and income goals in a boiler room from hell operation.

Just for good measure it seems, the bank also revealed that the Consumer Financial Protection Bureau is investigating whether they harmed customers by closing accounts when there was suspected fraudulent activity and doing so unilaterally without investigation. Hey, we all know their policy now: easy open, quick close, the customer be damned.

That’s not all of course. ACORN fought them for years over the issue of predatory lending winning a begrudging settlement and a gag order mainly for our California members. Others have sued them in recent years for discrimination in lending and of course who can forget the billions they paid along with other members of their tribe for sketchy securitization of mortgages.

Not enough for you yet? How about this one?

Wells Fargo with headquarters in San Francisco, California, a state with a significant Hispanic population, was just slapped down by a federal judge when Wells and its lawyers tried to argue that they had the right to discriminate. Yes, you’re hearing me correctly, the right to discriminate.

A federal judge shot down an argument from Wells Fargo last week that banks can discriminate against applicants, in certain cases, based on immigration status. The class-action lawsuit, brought by the Mexican American Legal Defense and Educational Fund, concerns six DACA recipients, more commonly known as “Dreamers,” who were denied student loans and credit cards from Wells Fargo because of their undocumented status. Are you following me, under deferred action the government allowed them to go to school, work, drive, and live semi-normal lives, but Wells Fargo, believed that despite the DACA relief from the federal government in allowing them to attend colleges and universities, the bank had the right to deny them student loans regardless.

Their culture is one big anti-customer hot mess. It’s not buyer-beware over there, it’s “come into my web said the spider to the fly.” I can’t stop scratching my head in continual wonder as I keep asking myself, “How can anyone keep their money at Wells Fargo?”