We DO Count: Making News

Key Vote in Congress over Your Right to Protect Yourself from Ripoffs
by Rosemary Shahan, Founder of We Do Count
Davis Enterprise: Letters to the Editor
August 2, 2017
 
"Last month, our U.S. Rep. John Garamendi cast a courageous vote against the Republicans' attack on American consumers. He stood up to Wall Street crooks like Wells Fargo on behalf of consumers, workers, and our military heroes and their families, who have too often been scammed by illegal practices and outright fraud.

He sided with hundreds of consumer, faith-based, civil rights and military/veterans organizations, and voted against the GOP attack on the Consumer Financial Protection Bureau and its new rule, which promises to restore the fundamental right, guaranteed by our nation's Constitution, to fight back in a court of law if you are ripped off or cheated.

We have been robbed of that right because of "forced arbitration" clauses hidden in the fine print of contracts with banks, credit card companies, cell phone providers, medical providers, nursing homes, car dealers and almost every other business.

The House Republicans voted to destroy the Consumer Financial Protection Bureau's new rule, and sided with Wells Fargo, which still persists in denying its victims their right to hold the bank accountable in a court of law....

President Trump sent GOP legislators a formal message telling them he is eager to sign the resolution destroying the rule, which will rob all consumers in our nation of their heritage as Americans to defend themselves through the third branch of our government, the judiciary.

Ironically, Trump is incredibly litigious, and threatens to sue anyone who dares to defy him. But he thinks you don't deserve to have the same right if you have been victimized by a bank that steals your identity and sets up fake accounts that ruin your credit."

Read more: Davis Enterprise: Letter to Editor by Founder of We Do Count: Garamendi votes for consumer protection
 

Founder of We Do Count Blasts Wells Fargo:
Illegal Repossessions of Cars Ruins Lives
CBS News, Los Angeles, CA
July 28, 2017
 
"The bank repossessed 25,000 cars from customers for being late with payments.

'This is really infuriating,' says Rosemary Shahan of Consumers for Auto Reliability and Safety, 'and there is no excuse for this. This is a company that's acting like a rogue company. They just seem to think they are above the law. And they can ignore the law and they don't care how many people's lives they ruin.'

She added, 'It ruins their credit, it ruins their lives. And a lot of times when cars are repossessed that is people's only way to get to work. If you're in the military it can also mean that you will lose your security clearance which ruins your career. And it also means we as a nation lose very highly-trained security personnel that we can't afford not to have doing their job.' "
 
"Wells Fargo is Trying to Bury Another Massive Scandal"
Vice
July 17, 2017
by David Dayen
 
"The bank became notorious last year for creating fake accounts on behalf of customers. Now it's trying to kill a class-action lawsuit over shady debit card fees.

Wells Fargo became a poster child for corporations that abuse their own customers last year when it got fined for ginning up roughly 2 million (maybe even more) fake accounts to meet high sales goals. The bank has since tried to block customer lawsuits over that misconduct, using fine print buried in contracts known as the forced arbitration clauses, which force customers to go not before judges but a secretive non-judicial process to get relief.

Wells Fargo continues to deny its victims their Constitutional rights.
It turns out Wells Fargo has a long history of using arbitration to evade legal scrutiny. In fact, for the past six years, Wells has tried to use arbitration to block a class-action suit that every other major bank in America long ago settled. This has not only delayed restitution for regular customers, but revealed exactly why Elizabeth Warren's brainchild Consumer Financial Protection Bureau (CFPB) moved to eliminate class-action bans through arbitration clauses earlier this month: It hands big banks a license to steal with impunity....

The case centers on something called debit card reordering. Let's say you have $100 in your bank account, and you make three purchases, costing $20, $30, and $110. Under Wells Fargo account guidelines, the bank can charge you a $35 overdraft fee for taking out more than you have in your account. But by reordering the transactions from highest to lowest, putting the $110 charge first, the bank could charge three separate overdraft fees, one for each attempt to draw insufficient funds. Simply by altering the transaction order, Wells Fargo could make an additional $70.

Multiply that by millions of customers, and you're talking about serious money....

Reordering has been ruled deceitful in federal court. Starting around 2008, consumers filed national class-action lawsuits against more than 30 different banks over these bogus overdraft fees. The cases got consolidated in 2009, in the Miami federal courtroom of US district court Judge James King. Most banks eventually settled with the plaintiffs: Bank of America agreed to pay $410 million in 2011; JPMorgan Chase promised $162 million in 2013. To date, banks have shelled out $1.1 billion in restitution for overdraft abuses.

Wells Fargo was the only one to keep fighting....

If the bank does prevail in moving the case to arbitration, people who got screwed and charged extra fees would have to pursue overdraft complaints by themselves. They would be at a major disadvantage: A recent study by the non-profit Level Playing field found that Wells Fargo customers have won only seven arbitration cases in the past eight years, out of just 48 that actually got to a final hearing. And just to pursue the case, consumers would have to spend heavily on legal representation and hearings. As federal judge Richard Posner of the Seventh Circuit Court of Appeals once wrote in a ruling, 'The realistic alternative to a class action is not 17 million individual suits, but zero individual suits, as only a lunatic or a fanatic sues for $30.' "

[Note: The study by Level Playing Field was commissioned by the CARS Foundation.]

Read more:
 
Vice: Wells Fargo is Trying to Bury Another Massive Scandal
 
"Here's why Wells Fargo forces its customers into arbitration: It wins most of the time"
Los Angeles Times
By Michael Hiltzik
April 7, 2017
 
"The insistence by Wells Fargo that the victims of its bogus account-opening scandal seek redress via arbitration, rather than in court, remains the best indication that the bank's promise to "make things right" for those customers is fake.

We've pointed out before that big companies like Wells Fargo love to force customers into arbitration because the companies are heavily favored in the process. They're repeat players, so they have familiarity with the system. They can stick customers with half the cost of arbitration, even if the customers win, increasing the customers' risk. And they can bar customers from filing class actions, which for a corporation is a big plus.

A new study shows just how advantageous arbitration has been for Wells Fargo. Short answer: For the bank, it's been great.

Wells Fargo -- the scene of the crime.
The study comes from Level Playing Field, an Arizona nonprofit that maintains a database of arbitration awards. The group mined records of 215 cases filed against Wells Fargo in 2009-2016 for its report. Its core finding is that of 48 consumer-initiated arbitration cases that resulted in a financial award, consumers won a documented victory in only seven, collecting a total of $349,549. The bank prevailed in 13 cases, collecting $485,208. Records for the other 28 cases don't identify a winner, but in those cases Wells Fargo was awarded $519,458 by the arbitrators, while the consumers received only $82,527.....

'The Wells Fargo situation illustrates exactly what is wrong with contemporary arbitration law,' says David Horton, an arbitration expert at UC Davis law school. Arbitration clauses typically are buried within account agreements, where customers' eyes skate over them. The Wells Fargo clause covers not only the specific accounts being opened, but almost any disputes with the bank, even those involving 'broken promises … or other wrongful actions.'

Especially egregious, Horton says, are clauses in the Wells Fargo agreement and others that forbid customers to file class-action lawsuits or to band together with other customers in class actions in arbitration.

'There's no question that requiring customers to pursue their claims individually means that fewer claims are brought,' Horton says, 'and companies like Wells Fargo aren't deterred from violating the law.'"

[Note: The Level Playing Field report was commissioned and released by the CARS Foundation, which provided funding for the research and compilation of the data.]

Read more:
 
Los Angeles Times: "Here's why Wells Fargo forces its customers into arbitration: It wins most of the time".
 
"Wells Fargo tries, fails to explain why customers shouldn't be allowed to sue over fake accounts"
The Consumerist
By Chris Morran
March 1, 2017
 
"Wells Fargo has admitted that thousands of its employees opened fake, unauthorized accounts in customers’ names, but the bank is doing everything it can to prevent these wronged customers from having their day in court. We asked Wells Fargo to explain why it believes hundreds of thousands of Americans shouldn’t be allowed to exercise their constitutional right to sue. The bank’s response made little sense (unless you’re a Wells Fargo executive).

Last week, We Do Count, a coalition of consumer advocacy groups, wrote a letter [PDF] to Wells Fargo CEO urging the bank to stop using arbitration agreements to sidestep accountability.

“Consumers have no reason to believe that Wells Fargo is doing anything differently, when the bank still persists in depriving its customers and workers of their basic constitutional rights,” reads the letter, signed by nearly two dozen groups, including the Consumer Federation of California, National Consumer Law Center, and Public Citizen. “A change in culture does not mean doing the right thing only when it does not cost anything. It means doing the right thing, period. How can Wells Fargo claim to be doing the right thing when it continues to force customers it has wronged into giving up their constitutional rights – even in cases where the account in dispute was created through fraud, identity theft, and /or forgery?”

And the advocacy groups are not alone. At least six U.S. Senators have asked Wells to not force these lawsuits into arbitration.

So why does Wells Fargo — which has already admitted that this fraud occurred — insist on keeping these cases out of the court?"

Read more: The Consumerist: "Wells Fargo tries, fails to explain why customers shouldn't be allowed to sue over fake accounts".