The Wells Fargo Watch
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ICP has published a book about the Wells-relevant topics of predatory lending, and corporate fraud - click here for sample chapters, here for a map, here for fast ordering and delivery, and here for other ordering information. CBS MarketWatch of April 23, 2004, says it has "some very funny moments." The Washington Post of March 15, 2004, calls Predatory Bender: America in the Aughts "the first novel about predatory lending;" the London Times of April 15, 2004, "A Novel Approach," said it "has a cast of colorful characters." See also, "City Lit: Roman a Klepto [Review of ‘Predatory Bender’]," by Matt Pacenza, City Limits, Sept.-Oct. 2004. The Pittsburgh City Paper says the 100-page afterword makes the "indispensable point that predatory lending is now being aggressively exported to the rest of the globe." Click here for that review; click here to Search This Site For or with more information, contact us.
Updated May 11, 2009
Inner City Press / Community on the Move (ICP) and its Fair Finance Watch have become increasingly concerned with Wells Fargo's predatory lending, including overseas. ICP first identified these issues at Wells in 1997 (see discussion of Wells' "Island Finance" and its 25% interest rate loans, below), and raised them then, and in 2000 (see, e.g., "N.Y. Activists Seek Nevada Hearing," Las Vegas Sun, Oct. 24, 2000, and "Consumer Advocates Want Hearings on Wells Fargo Deal," Associated Press, April 18-19, 2000 (Alaska). See also, "Group Objects to Wells Deals," by Todd Davenport, American Banker, July 29, 2003, Pg. 17, quoting ICP that "Wells Fargo is a predatory lender, and is exporting these practices beyond the United States." See also, "Group Files to Block Wells Fargo Acquisition," Seattle Post Intelligencer, July 29, 2002; "Wells Fargo Accused of Predatory Lending," Denver Post, July 29, 2003; "Wells Fargo Accused of Unfair Lending," Rocky Mountain News, July 29, 2003; longer list here.
Update of May 11, 2009: So the Fed even cooked the books on the stress tests, after Wells Fargo threatened to sue. Way to regulate...
Update of April 27, 2009: From the mailbag -
Subj:
My Plight with Wells Fargo Auto Financial
From: [Name withheld in
this format]
To: Inner City Press
Sent: 4/17/2009 6:59:57 P.M.
Eastern Daylight Time
Hello Matthew,
I've been referred to you by a family member to contact you about some trouble I've been having with Wells Fargo Auto Financial. I'd like to share my story with you, in hopes that you will promote awareness regarding Predatory and Discriminatory Lending Practices.
I myself, am a young, black female; have always been a part-time worker, and full-time student (until recently as of 4/06/09); and a single mother. At the time I contracted with WF, these same characteristics applied.
December 2007, I was deceived into a contract for an auto loan that did not state the terms that was initially discussed. Based on my good credit history, I was told that Wells Fargo would pay off all of my credit card debt, and buy out my car loan from Bank of America and I would end up paying a low monthly payment each month. Right before it is time to sign the contract, Wells fargo change the terms, and decided it was best to give me a check in the amount of $2000 to pay off my own debt, and buy out my car loan ($18K). This was a little fishy to my then, but I felt pressured to go ahead with the deal because (1) I spent almost 3 hours in this office, and I had to leave quickly; (2) I needed the money to pay off some debt and bills; (3) Wells Fargo offered an additional line of credit (as an incentive) for $1000, and (4) I didn't have to start paying for another month and a half.
The terms were $505.77 per month, which was far less than what I was paying for the bills separately. He told me where to sign, and I left. Things were fine for the first couple of months.
May 2008, I had a life changing event occur. My daughter had chronic bronchitis due to Chicago's weather and I had to move to Arkansas for a better climate environment. Upon my move I had certain job leads that fell through and was out of work for at least 4 months. During the entire time, Well Fargo called everyday, at least 3 or 4 times a day. My credit score dropped tremendously, and no one was willing to help. Once I did find a job, I paid all I could to Wells Fargo to get things back on track, but all the money was going torward the interest and not the principle of the load, which kept me at a standstill with paying it down.
I now landed a job where I currently make $30K. As I discussed to Wells Fargo, I've worked in the $505.77 in my monthly budget; but I know that I don't have the money to pay a past due balance, late charges, the current monthly payment, and rolocation expenses in preparation for this new job. I've kept them up to date with all of the changes, and yet they continue to threaten me with repossession, despite the fact that I paid out over $1500 within the last month and a half.
I've called numerous times to see if my loan can be restructured, and been given countless run arounds. Finally, Wells Fargo Bank explained that neither them nor Wells Fargo Auto Financial work with customers (new or existing) that live in Arkansas.
Bottom line, there was absolutely nothing they could do to help me. All the while, I owe $505.77 for March payment, $272.99 in late charges, $505.77 for April, and the $505.77 in May. My credit score is shot, so no other bank will loan me anything, and no car dealership is willing to take a trade in for a car only worth $8000 but a loan attached to it for $20,000.
I've contacted the CEO, John G. Stumpf, who had someone else send me a letter back explaining that since I signed the contracted there was nothing they could do. I'm seeking justice in that, Well Fargo needs to be stopped. They thought it was best for my financial situation to require a full-time student, part-time worker, single parent, young black lady to pay them $33,380.82 on a car worth $8000. Tack on a 19.24% interest rate to a loan, which would have me pay them $13,035.13 outright.
This is ridiculous, and something must be done. I trusted Wells Fargo in that they were charged to help me. They initially told me that there was something they can do to help, and made me believe that this is what was best for my situation. Now that I am a customer of theirs, there is nothing they can do to assist me. I am enraged!
Us too.
Update of April 6, 2009 -- In the first
study of the just-released 2008 mortgage lending data, Inner City Press
/ Fair
Finance Watch has found that Wells Fargo Bank confined African
Americans to
higher-cost loans above this rate spread 2.18 times more frequently
than
whites. Wachovia Mortgage FSB, the largest lender of Wachovia which
Wells Fargo
acquired, had a lower disparity, at 1.46.
Update
of January 19, 2009: Here are
properties in The Bronx, New York on
which Wells Fargo has foreclosed:
2096
RYER
AVE BRONX 2862 Multi-family $374,900 N
5730
POST
ROAD BRONX 1809 Multi-family $599,000 N
605
WALES
AVE BRONX 2700 Duplex TBD N
2194
WASHINGTON AVE BRONX 2403 Multi-family $325,000 N
4027
EDSON
AVE UNIT 1 & 2 BRONX 1848 Duplex $339,900 N
2782
CRESTON AVE BRONX 2000 Multi-family TBD N
Update
of January 5, 2009: Talk by Wells Fargo that
they had cleaned up their predatory lending act has been blown out of
the water
by the example cited by even the Wall Street Journal, of a $103,000
mortgage on
a shack in Arizona, purchased by Wells --
"Less
than two years ago,
Integrity Funding LLC, a local lender, gave a $103,000 mortgage to the
owner,
Marvene Halterman, an unemployed woman with a long list of creditors
and, by
her own account, a long history of drug and alcohol abuse. By the time
the
house went into foreclosure in August, Integrity had sold that loan to
Wells Fargo
& Co."
We'll
wait
to hear the spinmeisters at Wells try to explain this one away...
Update
of December 15, 2008: After
most big banks and
even many non-banks have already drawn down their bailout funds from
the government's
Troubled Assets Relief Program, there's belated interest in Congress in
what banks
have been doing. On the afternoon of December 8 on the Senate floor,
Byron Dorgon of
North
Dakota expressed shock at Wachovia's
purchase and lease-back of German sewer
system, just so it could use the depreciation of the German pipes to
avoid its
U.S. taxes.
Update
of December 1, 2008: From the mail
bag --
Subj: Reporting a Wells
Fargo
Issue
From: [Name withheld in
this
format]
To: Inner City Press
Date: 11/15/2008 12:39:20
P.M.
Eastern Standard Time
Hi, after reading your
“Wells
Fargo Watch” page I wanted to share a Wells Fargo story with you, in
hopes that
you will post it. I am most curious to find out if other Wells Fargo
employees
have suffered the same fate as my husband. I am trying to write this
account
carefully so as not to reveal my husband’s identity. However, should
you need
more details to confirm the story, please let me know.
My
husband is – or was -- a personal banker
with Wells Fargo. Over a month ago, one of his regular customers
presented a
$4,000 check for deposit to her account. My husband followed Wells
Fargo
security procedures to deposit the check to the woman’s account,
cautioning her
that the funds would not be available to her for at least 4 business
days.
Unfortunately, the check proved fraudulent, part of the widespread and
apparently sophisticated “mystery shopper” scam. The customer, who
claims to
have been duped by the offer she received in the mail, had already sent
$3,500
to the scammers’ account.
Despite
the fact that Wells Fargo employees
all over the U.S. and Canada have accepted these fraudulent checks for
deposit,
my husband was singled out – as far as we know – by Wells Fargo, and
accused of
complicity in the mystery shopper scheme. Wells Fargo immediately
placed him on
“paid administrative leave, pending investigation”. He was instructed
not to
contact any Wells Fargo team member, but to await a call from a local
Wells
Fargo Human Resources representative. Twelve days later, Wells Fargo
stopped
his paycheck. To this day, four weeks later, Wells Fargo has still not
contacted us, and the Human Resources representative has not returned
any of my
husband’s numerous phone calls.
Needless to say, this has
been a
financial disaster for our family. Not only have we lost my husband’s
paycheck,
as far as we know he has also lost his job. If he is terminated under
these
conditions he will be unable to “bond” to work as a banker ever again,
so in
that case he’s lost his career as well. Worse, without an official
termination
from Wells Fargo, he cannot apply for unemployment compensation, or
request
payment for his accrued paid leave, etc. He is essentially in limbo.
We consulted an attorney,
only to
learn that there is absolutely nothing we can do about this situation,
we can’t
force Wells Fargo to respond to us. And if Wells Fargo does eventually
terminate him, we cannot challenge it: we reside in an “employ at will”
state,
in which a company may terminate any employee at any time for any
reason, or
for no reason at all.
Update
of November 10, 2008: How will the bailout
funds be used? For opportunistic mergers, as we noted last week. And
now we can
say, for political contributions and lobbying. ICP Fair Finance Watch
was
interviewed
on November 7
"
Wells Fargo & Co.,
which announced a deal for Wachovia last month, gave out nearly $1
million
through its PAC in this election cycle, according to an analysis of
Federal
Election Commission reports. Wachovia Corp. PACs gave $1.2 million.
Wells Fargo
& Co., which announced a deal for Wachovia last month, gave out
nearly $1
million through its PAC.... Wells Fargo spent $3.6 million lobbying
federal officials
over the same period."
There is no commitment that
the bailout
funds will not be put to these uses.
Update of October 27, 2008: From Dow Jones on the Fed's self-approval of Wells Fargo - Wachovia: " The Fed said a commenter had requested a public meeting, but the Bank Holding Company Act does not require the board to grant that request. A Federal Reserve spokeswoman wouldn't disclose the name of the group that had requested the hearing." So now, like North Korea, the Fed tries to cover up even who has commented. For the record, ICP Fair Finance Watch made the request...
Update
of October 20, 2008: It's telling, in terms
of how sloppy the corporate giveaways have been, that neither the Fed
nor
Treasury thought through how buying warrants in Wells Fargo would put
Wells in
the position of reducing book value or recording a loss. Expect the
rule
changing for the biggest banks to continue...
Update
of October 13, 2008: Tales for a time of
lawless regulators giving rubber stamp bank merger approvals without
any public
notice or comment -- while Inner City Press / Fair Finance Watch has
already
commented to the Fed demanding they hold a comment period on Wells
Fargo's
proposal to buy Wachovia, now Wachovia says it will bypass its own
shareholders
-- with the NYSE's rubber stamp. Note to Fed: this doesn't make it an
emergency
to bypass the public too. But the Fed on Friday said, vaguely, that it
will
begin "immediate consideration" of Wells Fargo's application. But no FDIC involvement = no emergency.
Update
of October 6, 2008: With Wells Fargo's
announcement that is it outbidding Citigroup for Wachovia, and would
consummate
its proposal, without FDIC assistance, by the end of the year the
question
arises: how could the regulators bypass public notice and comment on a
transaction that has no FDIC involvement?
Citigroup's
low-ball $2.16 billion supposed deal, announced Monday, had rubberstamp
approval with no public notice or comment, including under the
Community
Reinvestment Act on CitiFinancial's widespread involvement in
controversial
subprime lending. Now, in the face of
Wells
Fargo's announced, the regulators have rushed out a strange press
release:
Statement
by the Board of Governors of the Federal Reserve and the Office of the
Comptroller of the Currency
A new
proposal to acquire
Wachovia has emerged from Wells Fargo.
The Citigroup proposal has undergone extensive review by the
Federal
Reserve and the Office of the Comptroller of the Currency.
We have not yet reviewed the new Wells Fargo
proposal and the issues that it raises.
The regulators will be working with the parties to achieve an
outcome
that protects all Wachovia creditors, including depositors, insured and
uninsured, and promotes market stability.
The scuttlebutt is that the regulators,
although having no basis to waive public participation this time, are
considering doing it, among other things to equalize the playing field
between
Citigroup's and Wells Fargo's bid. It is clear which bid is financial
superior
-- but Wells Fargo, too, has been involved in predatory lending,
through Wells
Fargo Financial and overseas. Some
advocates are saying they prefer the Wells proposal on the basis that
it should
finally allow some public process in the spate of supposedly emergency
mergers
and conversions.
Update of August 25, 2008: From the mailbag -
Subj:
Wells Fargo Mortgage Complaint
From:
[Name withheld in this format]
To:
Inner City Press
Date:
8/15/2008 12:58:48 P.M. Eastern Daylight Time
Hello,
I found your website today. My dealings with America's Servicing
Company owned
by Wells Fargo has been a constant struggle. Today, I am mailing a
complaint to
the Texas Dept. of Banking and Mortgage Lending as well to Barney
Frank,
Chairman of the House Committee on Financial services. The committee
passed HR
5579 which directed lenders to speed the loan modification process. I
made my
request to ASC/Wells Fargo in April 2008. I have yet to receive a
response.
Also, I have been unable to speak to anyone who might be 'working' on
the loan
modification.
Yep,
that's Wells Fargo...
Update
of August 4, 2008: Talk about a conflict of
interest, and regulatory capture -- last week, the regulators and four
big
banks issued coordinated press releases. "Officials from banking giants
Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo
& Co. issued a joint statement saying, 'We look forward to
being leading
issuers as the U.S. covered bond market develops.'" And those they
issued
the statement with and for are supposed to objectively oversee them...
Update of May 26, 2008: In a motion filed last week, Baltimore says Wells Fargo uses predatory lending practices in Baltimore's predominantly African American neighborhoods "to make a quick profit because it believes it can successfully exploit those communities" by
Charging higher interest rates;
Underwriting certain types of adjustable-rate mortgages without regard
for
whether the borrower can repay after the initial "teaser" rate
expires;
Stripping borrowers' equity through unnecessary refinancings;
Paying rebates to mortgage brokers for inflating interest rates;
Requiring prepayment penalties that prevent borrowers from getting help
through
refinancing;
Charging excessive points and fees with no corresponding benefits to
the
borrower.
Yep, that sounds
like Wells Fargo...
Update
of May 12,
2008: This week from the mailbag, from inside Wells Fargo
Financial --
Subj:
Attention Inner City Press
Date: 5/2/2008 2:10:09 P.M. Eastern Daylight Time
From: [Name withheld upon request]
To: Inner City Press
I am
currently a Wells Fargo Financial employee. I
didn't know if you would be interested or
not but I have some interesting information you may want to look into
further. I've been with Wells Fargo
Financial
since [redacted to preserve confidentiality of whistleblower]. I came right out
of school and landed what I thought was a great career with a great
company. Little did I know that I am
actually a consumer lender in the subprime mortgage industry. Our main product is our Real Estate refinance
which is subprime. The average rate is
about 10.5%. My belief is that wells
fargo financial is now downsizing and have found a clever way to lay
off a lot
of employees without getting into headlines as officially laying people
off. We have seen a huge decline over the
last six
months. I come from a smaller state,
last year around march of 2007 we had 50-some full time selling
employees. We are now down to 20-some. People
are leaving left and right and I am
hoping to get out of here by the end of summer.
I am an assistant branch manager. I have two points of interest
that I would like to let you in on to see what your opinion is about
the
situation.
Point
number 1: New Performance
Improvement Plan process (The PIP process as it is referred to here
regarding
the process of terminating a team member)
The
process used to be that if you did not book 100k of new money lent
over a 2 month period you were given a month to do at least 50k and
over the
next three months to book 150k total of new money to get off of the
PIP. If you
did not reach this, the company could recommend termination. It has only happened to two team members
since I have been with the company.
The
new pip process is as follows, if you have one month without doing
50k of new money you can be recommended for termination.
You have the following month to do 50k and if
you do not you are out basically.
Another process that has changed recently that leads me to
believe that
we are currently downsizing is that processor role in our branches. A processor processing all of the payoffs,
paid outs, deals with title work, and insurance as well as ordering
supplies
for the branch and maintaining the current loan pipeline.
Every branch had one processor, until this
month. There are only 3 main processors
in our district now, (there are 7 branches in our district) the other 4 have now been placed into part
time,
glorified secretary rolls. A processor
now has up to 2-3 branches each to process for and did not receive any
type of
pay increase as a result outside of performance branch based bonuses. Some of the part-timers have already decided
to quit and there isn't any rush to replace them.
Point
Number 2: Sub-Prime loans and Prime loans or (A-Paper Loans)
Our
business model is confused.
We are supposed to be subprime lenders, we sell to customers
with 620 or
below fico scores, that is our target market.
Anyone who has been in a sales position knows that sales is
about
persistence, hard work, and of course leads.
Our lead base is mainly retail sales finance accounts (ex:
tractor
supplies financing, heating and cooling, carpet, furniture stores etc.) Most of these customers usually finance with
12 months same as cash periods or 24 months same as cash periods etc. Lately things are tight you basically have to
have at least somewhat decent credit to get approved for this financing. Somewhat decent credit is above 620 fico
score. Most of these retail sales
accounts are 700 credit score customers and so forth.
Our job is to call these customers and
service those accounts and cross sell, credit cards, auto loan
refinancing to
pay off credit cards, and most importantly real estate restructuring. Taking the equity you have in your home to
combo other bills to put them into one ultimate loan with a lower
payment and
hopefully an overall lower total payback (which is rare).
Most
of these customers could go to their bank and do the same thing at
a much lower interest rate. Our company doesn't want us selling prime
loans because
we don't make money on these loans. If
we book a loan and it ends up going prime we do not receive credit for
it as a
unit or a loan. We do get paid 175 bucks
for each prime loan we book but if you do nothing but prime loans you
will show
no new money credit for these loans and zero units thus making it look
like you
didn't do anything. As a result you
would be pipped and begin the process of termination.
There is a way for us to keep a prime
customer from going prime, if we can convince the credit grade A, no
matter
what the fico score it could be and 850, to take a loan over 91% of the
total
loan value (example 100k home value, 91k loan amount) it will not go
prime.
The
tricky part is this, we as team members do not know what rate the
customer will qualify for, we have a matrix, every customer falls into
a
certain pricing non-prime grade meaning a 720 credit score can come up
and it
will show up as a 10% rate but if you go below 91% ltv it will show
that it can
be recommended for prime pricing.
Let me
give you a recent example:
I had
a 736 fico customer coming in wanting to do a 124k total loan on a
home he just had appraised about 6 months ago for 137k.
The appraisal itself was done by a friend of
the customers to purposefully bring it down because the loan he was
trying to
complete was the result of a divorce. I
still took the chance and put in the total value as 137k.
At a 124k total loan his total interest rate quoted
was 9.38%. He had no choice, because of
the way he was paid the bank would not cash flow him but we are very
conservative
as well but we were able to legitamitly cash flow him for the loan. (wells fargo doesn't mess around when it
comes to cash flowing loans, we get heavy documentation) We got an
appraisal
done (wells fargo also doesn't mess around when it comes to appraisals,
we have
absolutely no contact with the appraisers, we have a separate company
that we
pay to have the contact) the appraisal came back for 185k.
So obviously at this point, it would be tough
for me to get this loan up to 91% ltv.
For me it was simple, i want to do the right thing but at the
same time
i have to book loans, they put pressure on you to book it subprime, i
tried
like hell to sell 91% loan and nearly succeeded. The
customer ended up only taking an extra
15k which still kept it below the 91% required to keep it from going
prime. Still at this point i am not able
to disclose to the customer that all he had to simply do was take any
loan
under 91% and he would simply sign the final pricing disclosure showing
a 9.38%
rate but after a final review it will come back and give him a 5.5% -7%
loan. I still had to sell with the
customer having the intentions he would be getting a 9.38% rate. We sent up the final pricing disclosure it
was recognized as prime and the customer ended up with a 5.5% fixed
rate for 30
years to his surprise and glee. That
turned out great, of course it looks like I never booked a loan. Second scenario would have been if the
customer had agreed to take an extra 60k out putting him over the 91%
ltv mark
and thus keeping the loan at 9.38% for a 720 fico customer. We can never inform them of this until after
they agree to a higher rate like that is what they are getting and they
get a
prime loan. If i would have booked this
loan subprime in that particular month i would have received over 1k in
total
bonus money. Instead, I didn't hit the
mark required for bonus money and only received the 175k for booking a
prime
loan.
This
is of course a Cover Your Ass scenario for wells fargo but believe
me, it is not a good thing to book a prime loan, i had my district
manager
yelling at me for not being able to sell the extra 60k because once it
is prime
it doesn't count for the branches records, or the districts record or
the
regions record. No one gets credit.
That
is my fundamental reason for wanting to leave wells fargo
financial. I know we are in business to
make money, but not at the expense of humanity.
We
aim to have more on this...
Update
of May 5,
2008: from the Washington Post of
May 2
we have the story of the owner of the Shark Club of Bethesda, John A.
Tsiaoushis, in league with a gaggle of predatory lenders including
Wells Fargo.
For a house on Pennycress Lane, in January 2005, while Tsiaoushis owed
more
than $588,000 on the mortgage, he sold the house without repaying it.
Court records
show he created documents purportedly from the mortgage company, opened
a post
office box in Beltsville and had the settlement company send checks
totaling
$586,000 to the "mortgage company's" post office box, which
Tsiaoushis then deposited. Using friends and associates, Tsiaoushis
helped
refinance the house for subsequent buyers. In each case, checks
settling the
transactions were sent to post office boxes opened by Tsiaoushis, court
records
show, after he presented phony documents indicating that all liens had
been
resolved. Court records show that CitiFinancial of Falls Church paid
more than
$670,000 in a refinancing scam; Accredited Home Lenders of San Diego
paid
$891,000 to "buy" the house; and Wells Fargo in Alexandria lent
$585,000 in a refinancing scheme. First Franklin Financial of San Jose,
which
made the original, legitimate mortgage on the house, is owed $588,000,
court
records show."
When
sleazy lender First Franklin is the
"legitimate" lender in a story, and CitiFinancial and Wells Fargo
come in later without any due diligence, you get a picture of the
corporate
role in the current crisis....
Update of April
14, 2008: As Wells
Fargo claimed to cut back on subprime lending in 2007, a new ICP Fair
Finance
Watch study has found that Wells continued making super high cost loans
subject
to the Home Ownership and Equity Protection Act (HOEPA) -- that is, at
least
eight percent over comparable Treasury securities. Using 2007 Home
Mortgage
Disclosure Act data that was required to be released on March 31, ICP
Fair
Finance Watch has found that Wells Fargo, while making 381 HOEPA loans
in 2007,
placed African Americans in subprime loans 2.43 times more frequently
than
whites, and denied the applications of Hispanics 1.56 times more
frequently
than whites. The HMDA data for 2007 is the fourth year in which the
data
distinguishes which loans are over the FRB-defined "rate spread," of
three percent over the yield on Treasury securities of comparable
duration on
first lien loans, five percent on subordinate liens.
More analysis will follow.
Update of March 10, 2008: Foreclosure tale from New York, by a charter-bus driver in the East Bronx who has a mortgage payment that went from $2,482 to $3,500 a month. I had a two-year teaser rate, now going up every six months to a maximum of 13.2 percent, "I spoke to Wells Fargo. I tried to get them to keep the rate at the teaser rate, 6.8 percent... I'm in a home that cost us $35,000 in the sixties. We refinanced three times, and we owe $400,000."
Update of March 3, 2008: Now Wells Fargo must file reports on its mortgage delinquencies and foreclosures with the Office of the Comptroller of the Currency. Information from October 2007 through February is due by March 31. Better late than never.
Update of January 21, 2008: In further chickens-coming-home-to-roost news, Wells posted its first decline in earnings in six years, with profits down 38%...
Update of January 14, 2008: Wells Fargo was sued last week by the City of Baltimore for predatory and discriminatory lending. The U.S. Conference of Mayors projected that 361 metropolitan areas would take an economic hit of $166 billion in 2008 because of the foreclosure crisis. The Baltimore area was expected to lose more than $1.6 billion in economic output, according to the Conference of Mayors...
Update of July 2, 2007: The National Association of Securities Dealers has fined Wells Fargo Securities LLC $250,000 for not disclosing that a series of research reports about Cadence Design Systems Inc. were written by an analyst who was seeking a job with the semiconductor designer...
Update of May 21, 2007: From a report last week, 2006 subprime mortgage volume and status of Wells Fargo $27,869 Restated B&C volume, cut jobs, tightened menu.
Update of April 30, 2007: The Case of Wells Fargo and the Squishy Bed, Abusive Calls
From: [Name withheld in this format]
Date: 4/26/2007 10:37:42 AM
To: Inner City Press
Subject: Wells Fargo
Hello, In April 2006 I purchased a set of mattresses from a local
furniture company, Banner Mattress. Their finance service is with
Wells Fargo. The terms were no interest until 2010. I was
never told there were to be minimum payments or when/if they were
due.
Years ago I purchased new appliances from Home Depot and had the
same terms. I chose to pay them off in full on the date it was
due. I did so with no problem. Well immediately I started
receiving phone calls from Wells Fargo telling me I was late and would
be charged a $35.00 late charge. I told them that's impossible I
have a no interest loan until 2010. Needless to say I paid them
through my online banking account the $35.00 plus $35.00 late
charge=$70.00. There was no date given as to what would be a
PAYMENT DATE. Another time I spoke with the caller and
when I asked why they kept calling me after I paid them he shouted at
me and said they never received the payment. While talking to him
I went to the bank's web page and pulled the payment history for Wells
Fargo. Not only had they received payment it told me the day and
each month thereafter a payment for $35.00 He told me he would
call me non-stop if he had to. They continued to call/harass me
NINE times a day SEVEN days a week. I stopped answering the phone
when I saw it was them.
The pillow top mattress slowly became defective four months after
I got it. I thought I was imagining it as the salesman
specifically told me it would "bounce back immediately". After
stopping into the store I was told to give it some time. I did to
the point I was waking up each night and the next morning with a
terrible backache. I then sent an e mail to Simmons explaining
the problem which they never responded to. I again went to the
store and insisted he make a formal complaint. With that he sent
someone out to measure the depth of the permanent
depression=1 3/4".
The store contacted me a week later and told me their
representative from Simmons said they would replace it. At this
point with all the hassle from Wells Fargo and now a defective
mattress, I said no, I wanted my money back. The store called
back and said their Simmons contact refuses to return the
mattress. I then called Simmons myself and was rudely told the
same thing by someone there. At this point I called the store
back and told them the same thing I did Simmons, fine I would write a
letter to the Attorney General's office and to the BBB. Debbie at
the store told me to hold off as I wasn't the only one having problems
with Simmons and she would see what she could do. A week later
she called back and said they would return it and repay me what I had
paid Wells Fargo.
Herein lies the problem. I paid Wells Fargo $245.00 in 2006 and
$105.00 in 2007(online bank statements as proof). They told
Banner I would only receive $280.00 back as I had 8 late charges of
$25.00 each. The store and I both do not understand how they can
say this as that is not what the salesman presented as the contract
when purchasing the mattresses. Before I call Wells Fargo I would
like to know what I can tell them to get my full refund? How do
you fight a company who treats their customers as badly as they do by
harassing phone calls each and every day to an obsessive amount of nine
times?
Update of April 23, 2007: From the mailbag --
Subj: Wells Fargo Auto Finance
Date: 3/27/2007
From: [Name withheld in this format]
To: Inner City Press
I purchased a vehicle in February of 2006. It was financed through Wells Fargo Auto Finance. From February to November everything was fine. Then everything started to unravel. We made our November and December payments. Then on December 28th, we got a phone call from collections saying that we were 9 days late on our December
payment. I assured them that we were not. I told them the payment was made on December 19th. They informed me that payment was to cover November's payment.
I went back to check my bank statements. The November payment cleared on the 21st of November. The December payment cleared on the 22nd.
Come to find out, Wells Fargo received my November payment, but claims to have reversed that payment and sent it back. Unfortunately, that money was never received by me or my bank. So I faxed my bank statements showing the payment being deducted from my account and a confirmation number showing it going to Wells Fargo.
I get 4 to 5 calls from collections everyday, unless I ask to be removed from the call pool. Then I only get calls every 5th day. They claim that I am behind. They are assessing $10 late fees all over the place and reporting my payment history to the credit bureaus. All because they cannot see that they made a simple mistake and correct it.
Do you think that anyone has actually taken the time to apologize for all of this? One person named Wayne was very apologetic...and I felt he was sincere. I have talked to approximately 100 people...and only one had the guts to say that Wells Fargo should not be taking this long to correct the issue. As others have stated, I will never again do business with Wells Fargo.
Update of April 2, 2007: From the mailbag --
Subj: Wells Fargo Auto Finance
Date: 3/27/2007 10:29:50 AM Eastern Standard Time
From: [Name withheld in this format]
To: Inner City Press
I purchased a vehicle in February of
2006. It was financed through Wells Fargo Auto Finance.
From February to November everything was fine. Then
everything started to unravel. We made our November and December
payments. Then on December 28th, we got a phone call from
collections saying that we were 9 days late on our December
payment. I assured them that we were not. I told them the
payment
was made on December 19th. They informed me that payment was to
cover Novembers payment. I went back to check my bank statements.
The November payment cleared on the 21st of November. The
December payment cleared on the 22nd.
Come to find out, Wells Fargo received my November payment,
but claims to have reversed that payment and sent it back.
Unfortunately, that money was never received by me or my bank. So
I faxed my bank statements showing the payment being deducted from my
account and a confirmation number showing it going to Wells Fargo.
I get 4 to 5 calls from collections everyday, unless I ask to be
removed from the call pool. Then I only get calls every 5th
day. They claim that I am behind. They are assessing $10
late fees all over the place and reporting my payment history to the
credit bureaus. All because they cannot see that they made a
simple mistake and correct it.
Do you think that anyone has actually taken the time to apologize for
all of this? One person named Wayne was very apologetic...and I
felt he was sincere. I have talked to approximately 100
people...and only one had the guts to say that Wells Fargo should not
be taking this long to correct the issue.
I am getting ready to turn this over to the Better Business
Bureau. Hopefully the can help me out. Because as we all
know, Wells Fargo is not doing it. As others have stated, I will never
again do business with Wells Fargo.
Update of March 5, 2007: From the mail bag:
Subj: Wells Fargo And ASC
From: [Name withheld in this format at] malmstrom.af.mil
To: Inner City Press
I have been with Wells Fargo for a number of years. Not been a stellar client as far as my checking account goes I am ashamed to admit. But I am admitting it because it helps make sense of what recently happened. Christmas time I happened upon a secret shopping opportunity through what I thought was a trusted internet site. I proceeded to deposit the check assuming that Wells Fargo verifies funding. They held the check and released the money to me. As I turns out I was defrauded and the cashier’s check was stolen. When I asked Wells Fargo what happened to the verification, they stated that, “We only verify checks that are suspicious.” I told them that I had not been a stellar client and didn’t they think that a deposit of $4700 to an account that has NEVER had $4700 in it before would be suspicious? I mentioned to them that they at one time held a check for $300 from my father for three days. They are still holding me responsible for the money!
And they also sold my mortgage to ASC where I have had many problems with billing. Lost checks, late payments, etc. I had no idea that this info existed. Suppose I will be refinancing now!
Update of February 26, 2007: Wells Fargo last week gave WARN Act notices to 250 subprime lending workers in South Carolina...
Update of January 1, 2007: We begin the year with a blind item. Which person recently ejected from Wells Fargo Mortgage in Milwaukee after being charged with race discrimination has resurfaced at Chase Mortgage? And isn't there some duty to tell future employers, to protect future consumers?
Update of November 20, 2006: Wells Fargo Auto Finance brags that its "Full Spectrum Pricing'' program enables the bank to serve prime and nonprime customers -- more predatory lending...
Last week Inner City Press sat down for an interview with the president of the Nagorno-Karabakh Republic, Arkady Ghoukasyan, and asked him about the fires, about the United Nations and other matters. Click here for the footage, on Google Video.
Update of October 2, 2006: Florida is suing a "Tampa-area company called Global Information Group Inc., claiming it made thousands of calls impersonating customers of companies including Verizon Communications Inc., tricking them into providing private call records. Earlier this year the company's principals agreed to pay $250,000 to settle the case, and to cease any pretexting activities." Global Information's customers include Wells Fargo...
Update of August 28, 2006: Wells Fargo sleaze, from the LA Times: Wells Fargo's supposed safeguards for detecting illicit banking activities by terrorists, drug smugglers and other criminals were so weak that federal regulators should have publicly reprimanded the San Francisco-based bank, according to a Treasury Department report released last week. Instead, senior banking regulators met with Wells Fargo CEO Dick Kovacevich, then overruled their own staff by letting Wells off with an informal enforcement action -- sparing Wells the scrutiny and embarrassment suffered by other banks that have been forced to disclose that regulators faulted their oversight systems.
"We believe that [the Office of the Comptroller of the Currency] should have acted more quickly and forcefully to require Wells to strengthen its compliance and that OCC's failure to take formal enforcement action against Wells sent the wrong message to the banking industry about OCC's resolve to ensure that banks comply" with the Bank Secrecy Act, the inspector general's report said. The OCC staff recommended Feb. 4, 2005, that a formal cease-and-desist order be issued to Wells Fargo. Dick Kovacevich met five days later with top OCC officials, including Acting Comptroller of the Currency Julie Williams, who was then running the agency. After that meeting, the OCC pulled the recommended action from consideration by its top supervisory review committee, according to the report. On April 12, 2005, a new memo was issued recommending that the agency take informal action. Who's put at risk by Wells Fargo's laxities? For or with more information, contact us.
Update of July 31, 2006: More Wells and furniture: "El Dorado Furniture's success with its private-label credit card program has earned it the Wells Fargo Financial Retail Services Client Award. Wells Fargo presents the award to deserving clients based on program participation and credit card sales volume. 'We are honored to be recognized for our successful partnership,' said Robert Capo, vice president of the nine-store Florida retailer"...
Update of July 24, 2006: Wells Fargo last week missed Wall Street earnings expectations by a penny in the second-quarter because it sold off adjustable rate mortgages and debt securities in the quarter at a $250 million loss. In Wells furniture news, this: "La-Z-Boy is a brand name consumers have known and trusted for close to 80 years," said Dan Abbott, president of Wells Fargo Financial Retail Services. 'We look forward to helping them continue to build brand awareness and attract new customers with the La-Z-Boy Furniture Galleries MasterCard credit card program.'" What's next? Water beds?
Update of July 17, 2006: Wells Fargo is the eighth largest services of subprime mortgages in the country, with $25 billion, an increase of 3.39 percent from the year before...
Update of July 10, 2006: Indictment from another angle: environmental advocates note that Wells Fargo has invested millions of dollars in Massey Energy, which they say is destroying Appalachian communities with mountaintop coal removal...
Update of July 3, 2006: From Canada NewsWire of June 27: "Wells Fargo Financial Canada is looking for a bigger share of the non-prime mortgage market"...
Update of June 26, 2006: Mattress work, from a press release last week: "Mattress Firm, the No. 1 retailer of Sealy Mattress products, was recently honored as a recipient of the Wells Fargo Financial Retail Services Client Award... 'Mattress Firm continues to demonstrate its commitment to acquiring new customers and encouraging repeat purchases'... said Mark Hicks, senior vice president for Wells Fargo Financial Retail Services."
Update of June 19, 2006: From "The Oregonian" newspaper of June 15:
"Federal Home Mortgage Disclosure Act statistics analyzed by Wells Fargo Home Mortgage, for example, show that single women took out 13,246 home mortgages in the Portland area in 2005, about 20 percent of all loans for purchases. That's roughly in line with the Realtor association's national average. The numbers crunched by Wells Fargo also suggest, however, that single males made 16,389 purchases in the Portland area during the same period, or 25 percent. That's significantly higher than the association's numbers. The problem is that the two sets of numbers don't allow for apples-to-apples comparisons. Walter Molony, spokesman for the National Association of Realtors, said the federal HMDA numbers don't include cash purchases and mortgages from small lenders. So they show only part of the picture, he concludes."
So now Wells Fargo is "crunching" HMDA data for newspapers? But Wells Fargo elsewhere says that HMDA data don't prove anything....
Update of June 12, 2006: From the mail bag:
Subject: Fair Finance Watch
From: [Name withheld]
To: WellsWatch [at] innercitypress.org
Sent: Fri, 9 Jun 2006 10:53:14 -0400
Fact of impossibility- My husband and I were recently approved for financing by Prosperity Mortgage (brokers affiliated with Wells Fargo) at 58% debt to income ratio. Our current annual salary puts us at the 28% federal income tax bracket. It is obvious that we do not have the means to make the payments of these expenses. How is it possible that we were approved if the payments are impossible to make? Aren’t mortgage companies in the business of making money- not reselling properties that have been foreclosed upon?
You'd think...
Update of May 15, 2006: In all the talk of Wachovia's Golden West deal last week, the Charlotte Observer noted that it makes any "link up" between Wells Fargo and Wachovia less likely. So where might Wells go? Fifth Third? Damaged goods...
Update of May 8, 2006: It's happened again. On May 5, Wells Fargo announced by press release that a computer containing confidential data about mortgage customers and prospective customers was missing and may have been stolen. Wells blamed it on "a global express shipping company" that had been delivering the computer from one of the bank's facilities to another. The missing data include names, addresses, Social Security numbers and mortgage loan deposit numbers....
Update of May 1, 2006: Corporate watch -- among the companies served or previously served by those who last week won Wells Fargo board elections by Saddam Hussein-like margins are US WEST, PricewaterhouseCoopers, Pacific Telesis Group, Agensys, Foster Pepper PLLC, General Mills, SUPERVALU INC., and T-Mobile. Calling all...
Update of April 24, 2006: Inner City Press / Fair Finance Watch has conducted a comparative study of 2005 Home Mortgage Disclosure Act data, this time focused on New York City, and has found Wells Fargo denied applications from The Bronx three times more frequently than applications from Manhattan in 2005. Meanwhile, in Des Moines last week, Dick Kovacevich bragged that "Our growth here is nothing short of phenomenal. One out of every 245 Iowans works for Wells Fargo." No talk of the underlying corporate welfare, nor of Wells' questionable subprime lending...
Update of April 10, 2006: The 2005 Home Mortgage Disclosure Act data, which Inner City Press / Fair Finance Watch received in late March from Wells Fargo, reveal that, considering all conventional first-lien loans, Wells Fargo in 2005 confined African Americans to rate spread loans 3.31 times more frequently than whites. The Federal Reserve has defined higher-cost loans as those loans with annual percentage rates above the rate spread of three percent over the yield on Treasury securities of comparable duration on first lien loans, five percent on subordinate liens. More analysis will be forthcoming. For now, we note that in 2005, Wells Fargo made 795 super high-cost loans subject to the Home Ownership and Equity Protection Act (HOEPA) -- that is, using one definition, at least eight percent over comparable Treasury securities. Usury, anyone? Developing.
Update of April 3, 2006: At the subprime lender Wells Fargo Financial, the beat goes on, from West Coast to East. In the news last week, in Lancaster, California at the Lancaster Town Center mall at 10th Street West and Avenue K. And east in Florida, at Wells Fargo Financial America Inc., 3280 N. John Young Parkway in Kissimmee. Predatory lending is on the move...
Update of March 27, 2006: the Federal Reserve has now asked about Santander's acquisition from Wells Fargo of the subprime lender Island Finance, asking for detail on Santander's due diligence on Island. Santander responds that it will file by March 29, and that it considered much about Island Finance, including Home Mortgage Disclosure Act compliance. We'll see...
Update of March 6, 2006: Payday lender ACE Cash Express last week put out a press release bragging that that it has "amended its existing bank credit facility" with the involvement of Wells Fargo Bank is the Administrative Agent and Co-Lead Arranger."
Update of February 27, 2006: Some are citing the Des Moines parking lot of predator Wells Fargo Financial as a good example of eminent domain. But wasn't / isn't it rather corporate welfare?
Update of February 20, 2006: Wells’ sell-off to Santander of Island Finance in Puerto Rico was rubber stamped by the FTC last week, via an early termination of the waiting period required under the Hart-Scott-Rodino Antitrust Improvements Act…
Updated February 13, 2006: From the Buffalo News of Feb. 6: “In New York State, Wells employs 1,430 in offices in 47 cities. Its businesses statewide include Acordia, Wells Fargo Home Mortgage, Wells Fargo Century, Wells Fargo Equipment Finance, Wells Fargo Securities and Wells Fargo Financial.” That last one is the subprime… Also on Feb. 6, Wells Fargo announced via press release that “it has expanded its association with NASCAR's Petty Enterprises beyond Wells Fargo Financial, its consumer finance business, to encompass Wells Fargo Home Mortgage and all the company's business groups.” Petty subprime…
Update of February 6, 2006: In the run-up to Super Bowl XL in Detroit, Inner City Press / Fair Finance Watch has analyzed mortgage lending patterns in the Detroit Metropolitan Statistical Area in the most recent year for which data is available, 2004. At Wells Fargo Bank, N.A., American Americans were over 7.2 times more likely to be confined to higher cost loans than whites, and Hispanics were over 2.8 times more likely to be confined to higher cost loans than non-Hispanic whites…
Update of January 30, 2006: Santander has announced a proposal to acquire the problematic subprime lender Island Finance (on which ICP has previously commented to the FRB) from Wells Fargo. ICP first became aware of Wells Fargo's subprime lender Island Finance in 1997, when the company (1) opened an office at 2866 Third Avenue in the South Bronx which charged 25% interest rates to all customers, without regard to credit history, then (2) closed the office and required the customers they'd lured to travel to a Wells Fargo Financial office in Queens or have "lates" imposed on their credit history (see sVillage Voice of July 15, 1997). Wells' Island Finance is (sub-) headquartered in San Juan, Puerto Rico, and has branches in Panama, Aruba, the U.S. Virgin Islands, and the Netherlands Antilles. It is a high-rate lender, and is also embroiled in litigation with its employees. See, e.g., Jagroop v. Island Fin. V.I., Inc., (U.S. District Court for the District of the Virgin Island, Division of St. Croix), 240 F. Supp. 2d 370; 2002 U.S. Dist. LEXIS 25153. Tellingly, Wells CEO Dick Kovacevich lobbied in person in May 2002 against a proposal in the Puerto Rican legislature, House Bill 1288, to impose a usury cap of 19.75%. See, Caribbean Business, May 16, 2002, quoting 27% interest rates and Kovacevich that, with the proposed rate cap, " I feel I’m being told Wells Fargo is not welcome in Puerto Rico... I don’t want to be threatening, just factual," and characterizing Wells as the U.S.'s "number one 'NAFTA bank,' with more banking stores and assets than any competitor within 60 miles of Mexico and Canada." In acquiring Island Finance, Kovacevich said that it portended further expansion into other Latin American markets." (PR Newswire of May 4, 1995.) At the time, Wells stated that it had recently also "acquired Reliable Financial Services, Inc., an auto finance company headquartered in Rio Piedras, Puerto Rico, which manages $200 million in receivables." (PR Newswire of January 12, 1998.) Wells also lists "Island Finance" subsidiaries in the Cayman Islands, British West Indies, and in Trinidad and Tobago -- these are apparently not proposed to be acquired by Santander, although the precise scope of Santander’s proposal needs to be inquired into, publicly, by the Federal Reserve Board... .
Update of January 23, 2006: Pretending to be green, last week Wells Fargo announced the hiring of a new “of head of environmental finance.” He’s Barry Neal, previously a founding partner of El Paso Energy Corp.'s EP Power Finance LLC. How very environmental…
From the mailbag:
Subject: Wells Fargo Financial - Unfair and miss leading Business
Practices
Date: 1/18/2006 12:20:37 PM Eastern Standard Time
From: [Name withheld]
To: WellsWatch [at] innercitypress.org
I like to share this with your readers so to
warn them of this injustice. I took a loan for $7,500 in July of 2002
for home improvement from Wells Fargo Financial. The loan was
broken down to 60 installments of $182.38 totaling to 1,0942.80
from which $3,442.80 was the interests for 60 months. I paid off
the loan after I got my first statement in July of 2002. As
of December of 2005, I have been receiving statements for the amount of
$182.38.
I am told that although I paid off $7,500 I paid it towards my payments
ahead of time and not paid off the loan. So after 3 years, I
still owe Wells Fargo the interest on the original $7,500, which
amounts to $3,442.80. I spoke to the Customer service on
the phone and he kept saying the same thing and was unwilling to get
that I cannot owe any finance charges if I paid of the original loan.
I am surprised how a large financial institution will not understand
basic mathematics and is playing such tricks on their
customers. After having a saving account with
this organization for over 20 years, I plan to close my accounts and
move on with a more reliable and honest organization with some
integrity.
Update of January 9, 2006: Last week’s American Banker reminds of Wells and money laundering: “industry observers said the [new OCC] guidance was a clear response to questions raised last year about its supervision of Wells Fargo & Co. Senior OCC managers overturned the recommendations of field examiners that Wells receive a formal cease-and-desist order for anti-laundering lapses. A February memo recommended a public enforcement action, but after a meeting between Julie Williams, then the acting comptroller, and Richard Kovacevich, the chief executive officer of Wells, the memo was redrafted to recommend a less strict, nonpublic action…. The Treasury Department's inspector general is investigating the matter and is expected to issue a report next month.”
Update of December 26, 2005: The NASD on December 19 fined Wells Fargo $3 million, for abusive fund sale practices: steering investors into inappropriate fund share classes. Instead of selling class A shares Wells Fargo pushed class B and class C shares, which were less suited to the investors' needs, the NASD said. So: predatory in fund sales too…
Update of December 19, 2005: an APB from Salem, Oregon, where an employee of the subprime Wells Fargo Financial has moved over to the supposedly prime Wells Fargo Home Mortgage. Bringing predatory lending along? He could be asked – he’s pitching his number, at 503-982-2788… Higher up, selling at the top. Insiders at Wells, including Dick Kovacevich, sold a net 120,091 shares this quarter, according to SEC filings…
Update of December 12, 2005: Last week Wells CEO Dick Kovacevich said the company isn't interested in buying a stake in GMAC, stating that it wouldn't fit with Wells Fargo's usual strategy of not being a partial owner of business lines. This seems inconsistent with Wells' many "joint ventures" in mortgages, including subprime mortgages...
Update of December 5, 2005: Military personnel on active duty are being overcharged on high interest loans by banks including Wells Fargo, a new investigation of compliance with the Servicemembers’ Civil Relief Act (SCRA) by Inner City Press / Fair Finance Watch has uncovered. Through documents obtained under the Freedom of Information Act, ICP had documented widespread violations of the SCRA, defrauding and overcharging of those in active military service, and regulatory inertia in dealing with the abuses.
The Servicemembers’ Civil Relief Act, at 50 USCS Appendix Section 527(1)(a) provides that “An obligation or liability bearing interest at a rate in excess of 6 percent per year that is incurred by a servicemember, or the servicemember and the servicemember's spouse jointly, before the servicemember enters military service shall not bear interest at a rate in excess of 6 percent per year during the period of military service.”
The purpose of the SCRA, formerly known as the Soldiers’ and Sailors’ Civil Relief Act, is to provide interest rate relief and other protections “to servicemembers of the United States to enable such persons to devote their entire energy to the defense needs of the Nation.” Section 502.
Wells Fargo’s practices are reflected in the complaint to the OCC now online at www.innercitypress.org/wellsscra54.jpg
“On [ ] January 2003, my Army Reserve Unit, the [REDACTED] received notification of mobilization and deployment to the Persian Gulf area. Within days I received my individual mobilization order, which specifically stated I was mobilized in accordance with Title 10, a Presidential call up, in support of Operation Enduring Freedom. I contacted Wells Fargo whom I had 2 home equity accounts with, and advised of my mobilization and the fact that I was eligible to receive a reduced interest rate of 6% on my two outstanding home equity accounts per the Soldiers and Sailors Civil Relief Act of 194[0]… In mid July 2003 I returned to my residence from the Persian Gulf at which time I learned from my wife that Wells Fargo never reduced our interest rate to 6% as is required by Federal law…”
ICP will be pursuing these issues further. For or with more information, contact us.
Update of November 28, 2005: Inner City Press / Fair Finance Watch is analyzing Gulf Coast mortgage lenders in the Katrina-zone, identifying those which in 2004 had the worst disparities between the percentage of African American and white borrowers who were charged higher costs, over the Federally-defined rate spread of 3% over comparable Treasury securities on a first lien loan, 5% on subordinate liens. Interim results including this finding, that in the New Orleans Metropolitan Statistical Area, Wells Fargo Bank, NA in 2004 was 3.4 times more likely to confine African Americans to higher cost rates spread loans than whites…
Update of November 21, 2005: Wells Fargo disclosed last week that the “increased level of consumer
bankruptcies filed before new bankruptcy laws took effect Oct. 17 will
widen its
fourth-quarter net loan charge-offs by an estimated $175 million, or 7
cents per share,
after tax.” So Wells took a charge for
initializing effect. But after that, it’s all gravy...
Update of November 14, 2005: Feeling lucky? Last week Ameristar Casinos announced that that it has a new $1.2 billion senior secured credit facility arranged by... Wells Fargo Bank, N.A.. Meanwhile Wells also served as trustee on securities backed by subprime loans by Option One, which along with its affiliate H&R Block Mortgage makes more than 70% of its mortgages to African Americans in Missouri over the federally defined rate spread, of 3% over comparable Treasuries on a first lien, 5% on subordinate liens...
Update of November 7, 2005: Wells
Fargo has set aside $100 million to cover the impact that Hurricane
Katrina might have on
its loan portfolio. Howard Atkins, Wells' CFO, told the WSJ that the
bank continues to
evaluate the impact of Katrina. "We may find we don't need the $100
million," he
said...
Update of October 31, 2005: The M&A grapevine tolls for Fifth Third, with publications from New York, Minneapolis and Cincinnati all predicted last week 5/3’s imminent take-over by Wells Fargo. Birds of a CRA-arrogant feather may flock together. We'll see.
Update of October 24, 2005: Wells
Fargo Financial
saw its profit drop by 53% to $79 million. The company said that was
largely because the
division set aside $100 million to cover loans it expected to go bad
because of Hurricane
Katrina. But many of these loans were unaffordable and unsuitable prior
to any
hurricane...
Update of October 17, 2005: We must of course note the U.S. District Court’s decisions in the cases by the OCC and the Clearing House banks -- including Wells Fargo --against the NY Attorney General, to avoid providing the credit score information they say would justify the racial disparities in their lending. Why should the public believe a defense that they go to court to conceal? Whether or not an appeal is taken, and whether or not it’s successful, the public must demand that the OCC bring enforcement action(s) on Wells Fargo’s disparities, and must separately pursue them, far and wide and ceaseless...
Update of October 10, 2005: We
like edgy arts -- but
not by predatory lenders. Last week the David Rockefeller-founded
Business Committee for
the Arts have an awarded to the Wells’
subprime unit Wells Fargo Financial, which during the construction of
its lair in Des
Moines, allowed the surrounding wooden fence to become “a canvas for
murals by Iowa
artists.” How touching...
Update of October 3, 2005: From
CNBC of September 25:
BARTIROMO: Now Wells Fargo offers a high
percentage of sub-prime
lending, and in that kind of lending, you're talking about triple the
rate of
foreclosures. Is that a concern for you?
KOVACEVICH: Well, we have--you have to price for that risk when you
are--the most
important thing is that you give borrowers a chance to borrow money.
And these are riskier
borrowers and you have to charge a higher rate for that risk. But you
can't red-line this
group. These are people who need loans, who want to buy a home, and we
simply charge more
for the risk that we're taking. And so far, that has turned out to be a
good business for
us. But as importantly, it's allowed people to buy homes, get into home
ownership, that
they wouldn't be able to do if we didn't offer these products to
higher-risk, lower-income
people.
Question:
while not conceding those points, how do they address the non-mortgage
part of Wells
subprime lending? High cost furniture loans and the like?
BARTIROMO: And what's your take on the
current
national post-Katrina story about race divisions in this country and
the haves and the
have-nots?
KOVACEVICH: Well, I think unfortunately there is some of that. But I
think what we all
have to do is work together to make sure that we reduce and eliminate
any discrimination
of any type. And companies, I think, corporate America has to take a
leadership position
in this because it starts with employment. And if people are employed,
you know, they have
jobs; they can integrate well into society. And the real tragedy is if
you don't have a
job, and what we ought to do is make sure that everyone has a job and
not discriminate in
any way in employment.
We’ll see...
Update of September 26, 2005: We've looked closer at Wells Fargo's 2004 lending record, this time in the Nashville MSA, considering which loans are subject to a rate spread (3% higher than comparable Treasuries on a first lien, and 5% on a subordinated lien) -- Wells Fargo in the Nashville Metropolitan Statistical Area in 2004
Whites: 2009 originations, 187 over the rate spread (11.81% of loans over the rate spread)
African Americans: 198 origination, 59 (38.02%) over the rate spread -- 3.20 times higher than for whites...
Meanwhile, HUD last week announced a $48,000 settlement with Prudential Locations, LLC for violations of the Real Estate Settlement Procedures Act. HUD found that Prudential's Honolulu real estate brokerage office leased a luxury car, offered vacations and provided other gifts to reward sales agents that referred business to an affiliated mortgage company. Prudential is affiliated with and has a financial interest in Wells Fargo Home Mortgage Hawaii, LLC. HUD's investigation found that Prudential hosted a ‘First Annual Wells Fargo Friends Party’ and invited only those sales agents that referred over $1 million in business to Wells Fargo. Great...
Update of September 19, 2005: Wells Fargo Financial Acceptance trumpeted its subprime auto loans in Canada, naming its “Stagecoach Award” partners / co-conspirators, including St. Jean Mazda of St-Jean-sur-Richelieu, QC. How do you say predatory lending en francais?
Update of September 12, 2005:
From last week’s
Mercury-News: “Antonio Lopez and Fabiolo Estrada... said they were
contacted in 2003
and 2004 by phone by a broker from Wells Fargo
Financial, the
San Francisco bank's subprime lending unit. Convinced that refinancing
their East San Jose
home would help them pay off some department store bills and other
debts, the couple
refinanced in 2003 into a Wells Fargo loan with an interest rate of
about 7.4 percent.
Less than a year later, in early 2004, the broker suggested they
refinance again to lower
their interest rate. They got a 30-year loan with a rate of 6.25
percent for three years,
which could rise later when the loan became adjustable. What they
didn't realize, they
said, was that the two loans were netting Wells Fargo and their loan
representative a
whopping four "points" each -- $ 27,000 in total fees and commission.
It also
cost them an additional $ 17,000 for a "prepayment penalty" for paying
off the
2003 loan early. And their second loan would probably get steeply more
expensive in a few
years, requiring them to pay a lot more or refinance yet again. The
couple, who had
refinanced in the past, say they thought both loans had fixed rates for
30 years, and they
didn't know how much they were paying the broker or about the
prepayment expense. They
said if their loan representative told them, he explained it at "150
miles per
hour," Lopez said. "If I knew what I know now, I never would have
refinanced so
much," Lopez said. Wells Fargo said it cannot discuss the Lopez-Estrada
loan, but
said four points is standard when making loans to borrowers with
subprime credit standing.
The bank's senior vice president for its home and consumer finance
group, Lynn Greenwood,
said Wells Fargo would have taken into account any late payments on any
debts, credit
score and overall indebtedness when deciding the couple's loan rate.”
Update of September 5, 2005: On August 30, Wells Fargo announced what it
called
improvements to its lending practices. Many of the reforms are less
meaningful than
claimed. For example, any fanfare about dropping mandatory arbitration
now that
anti-consumer class action reforms have been passed, and the GSEs no
longer buy loans with
arbitration clauses, is misplaced. As set
forth in Inner City Press’ Gulf Coast Watch, in Louisiana in 2004, over
30% of Wells
Fargo’s mortgages in Louisiana were higher cost, rate spread loans. Click here for more of ICP’s Gulf Coast Watch.
Update of August 29, 2005: De rumores -- last week the British press was aflutter with the rumor that Wells Fargo would bid on Lloyds TSB. We’ll see...
Update of August 22, 2005: On the furniture loan beat: "’We have
seen favorable results with longer-term promotions, which allow
cardholders to spread
their payments out over an extended period of time, such as 12, 18 or
24 months,’
said Terry Fuller, senior vice president of business development for
Wells Fargo Financial
Retail Services.”
Update of August 15, 2005: On August 11, Wells Fargo settled for $34
million a
lawsuit accusing it of charging excessive credit card processing fees
to businesses.
Merchants accused Wells Fargo of extracting a variety of fees it never
disclosed, and
failing to explain the fees when asked. Sounds like Wells...
Update of August 1, 2005: From
the mail bag,
catching up:
Subj: WELLS FARGO
Date: 7/12/2005 8:06:32 PM Eastern Standard Time
From: [Name withheld]
To: WellsWatch [at] INNERCITYPRESS.ORG
FOR ABOUT 10 YEARS I HAVE HAD AN ACCOUNT WITH
WELLS FARGO AND NEVER
HAD PROBLEMS UNTIL JAN. 05, I HAD ARRANGEMENTS FOR MY CHECKING ACCOUNT
TO BE DEBITED
MONTHLY TO PAY MY CARNOTE. HOWEVER, I RAN INTO A PROBLEM AND WAS SHORT
OF MONEY ON THE DUE
DATE, AND CALLED THE BRANCH TO HAVE THEM WAIT 2 DAYS UNTIL THEY DRAFTED
THE PAYMENT, I
CALLED AND MADE THE ARRANGEMENTS FOR THE 30TH INSTEAD OF THE 28TH.
WELL, MY ACCOUNT WAS DEBITED ON THE 30TH
AND ALSO ON THE 28TH, WHICH
CAUSED BOTH TO BE NSF. I HAD NO IDEA UNTIL A WEEK OR SO LATER THAT MY
CHECKING ACCOUNT WAS
DEBITED TWICE IN 2 DAYS , WHICH OF COURSE, AS YOU CAN IMAGINE , MY
SHOCK AND HORROR OF
MANY NSF NOTICES IN MY MAILBOX. I CALLED WELLS FARGO TO FIX THE
PROBLEM, BUT JUST GOT THE
RUN AROUND. THEY TOLD ME TO CALL CUSTOMER DISPUTES , SO I DID , AND WAS
TOLD TO FAX A BANK
STATEMENT. I FAXED MY BANK STATEMENT, WHICH CONTAINED BOTH DEBITS AND A
NUMBER OF NSF
FEES, AND STILL AS OF THIS DATE , HAVE NOT HEARD A WORD. I HAVE TRIED
TO CALL CUSTOMER
DISPUTES AGAIN, BUT NO ONE WILL RESOLVE THIS ISSUE, AND NOW ,
MYSTERIOUSLY, CUSTOMER
DISPUTES DOES NOT EXIST. TO DATE, I AM BEING HARRASSED ON A DAILY
BASIS, WELLS FARGO
CLAIMS I AM A MONTH BEHIND ON MY CAR PAYMENT. A COLLECTOR CALLED ME AND
TOLD ME MY ACCOUNT
IS BEING REVIEWED BY THE REPO COMMITTEE, AND HE ALSO TOLD ME HE DID NOT
CARE WHAT WELLS
FARGO DID TO MY ACCOUNT AND FOR ME TO STOP TALKING IN CIRCLES , THAT I
STILL HAD TO PAY
THE NSF OR LOSE MY CAR. EVEN ON THE DAY THEY GET A PAYMENT, THEY WILL
CALL TO SEE WHEN I
AM GOING TO SEND ANOTHER. THEY CALL ME AT WORK , AT HOME SEVERAL TIMES
A DAY. I HAVE
THOUGHT OF CONTACTING AN ATTORNEY AND SUING THE HELL OUT OF THEM. I
HAVE NEVER MISSED A
PAYMENT. BUT THEY WILL NOT LISTEN TO ME OR RESOLVE THE SITUATION , OR
EVEN REFUND MY NSF
CHARGES THEY CAUSED.
Update of July 5, 2005: From the
June 30 American
Banker: “Some observers argued that any formal enforcement action would
have
prevented Wells from making acquisitions, such as the one it completed
last week for First
Community Capital Corp. of Houston. The $124 million deal was approved
by the Federal
Reserve Board, which noted that Wells was implementing improvements to
its anti-laundering
program. When the OCC memo became public, Wells' chief counsel, Jim
Strother, acknowledged
the anti-laundering problems and said his company was working to
correct them. He would
not discuss Wells' relationship with the OCC.”
Of course, the OCC is suing to shield Wells Fargo from a fair
lending inquiry from
the New York State Attorney General...
More Wells Fargo in the
shadows: the June
27 edition of the publication Furniture Today
reported that “buying group Furniture First says it will offer a
private-label credit
card program through Wells Fargo Financial Retail Services. Wells Fargo
will provide
Furniture First members with account management and sales support,
sales training,
individualized client support, integrated technology and custom
marketing solutions.
Furniture First said the program will include a dedicated line of
credit for approved
customers, promoting larger purchases,” etc..
Update of June 27, 2005: The
Federal Reserve’s
June 23, 2005, Wells Fargo order
The Fed also recites that ICP “expressed concern about Wells
Fargo’s and
WF Bank’s information-security systems and cited a press report
describing three
instances of theft of computers containing information relating to
customers of Wells
Fargo’s subsidiaries. Wells Fargo represented that it is not aware of
actual identity
theft or fraudulent activity as a result of these incidents and that it
provided
potentially affected customers with notice of the thefts and credit
bureau monitoring and
identity theft insurance services. In reviewing Wells Fargo’s
application, the Board
has considered the enhancements Wells Fargo is making to its
information security systems
and has consulted with the OCC, the primary federal supervisor of WF
Bank.” This in
an environment of accelerating violations of consumers’ privacy...
In
footnote 13, the Fed says that ICP “criticized Wells Fargo’s
relationships with
unaffiliated payday and car title lenders and other nontraditional
providers of financial
services. Wells Fargo represented that it has acted as a lender or
provider of credit
facilities and in other ordinary business relationships to unaffiliated
consumer finance
businesses, which may include payday and title lenders. Wells Fargo
stated that it does
not participate in the credit review process of such lenders and
customarily requires the
entities to represent, warrant, and covenant to Wells Fargo in credit
agreements that such
entities have and will comply with all applicable laws in the conduct
of their
business.” What’s being referred to
here includes Wells Fargo funding a payday lender that is explicitly
(and exclusively)
directed at active duty military personnel... Meanwhile
last week, the Air Force newswire reported that the “Defense Department
has launched
a new effort to educate servicemembers about the dangers of borrowing
from
‘loan-shark’ lending companies and to teach them how to avoid ending up
in a
spiral of compounding debt, a DOD official said here June 17. The most
prevalent type of
loan-shark lending affecting servicemembers is what is known as ‘payday
loans,’
said John Molino, deputy undersecretary of defense for military
community and family
policy.” But on the issue of Wells
Fargo’s lending to payday lenders which target military personnel, the
Fed has done
nothing...
The Fed also says that “although the HMDA data may reflect
certain disparities
in the rates of loan applications, originations, and denials among
members of different
racial groups in certain local areas, the HMDA data do not demonstrate
that the WF Prime
Lenders are excluding any racial group on a prohibited basis. The
Board, nevertheless, is
concerned when the record of an institution indicates disparities in
lending and believes
that all banks are obligated to ensure that their lending practices are
based on criteria
that ensure not only safe and sound lending, but also equal access to
credit by
creditworthy applicants regardless of race or income level.” So the Board is concerned. Where’s the action?
In note 34, the Fed says that ICP “criticized the customer
service and
complaint procedures of a Wells Fargo subsidiary engaged in subprime
lending in Puerto
Rico and urged the Board, without specific allegations, to closely
scrutinize the subprime
lending operations of Wells Fargo in general. Wells Fargo originates
subprime mortgage
loans through WF Financial and Island Finance, and numerous joint
ventures originate
subprime loans that are underwritten and processed through WF
Mortgage’s unit, Wells
Fargo Mortgage Resource. WF Financial and Island Finance are nonbanking
subsidiaries of
Wells Fargo. As the Board has previously noted, subprime lending is a
permissible activity
that provides needed credit to consumers who have difficulty meeting
conventional
underwriting criteria. The Board, however, continues to expect all bank
holding companies
and their affiliates to conduct their subprime lending operations
without any abusive
lending practices. See, e.g. Royal Bank of Canada, 88 Federal Reserve
Bulletin 385, 388 n.
18 (2002).”
When the Fed finally (has to) consider the 2004 data, it will
find at Wells Fargo
nothing but abusive lending practices...
Update of June 20, 2005: On June 16, both the Office of the Comptroller of the Currency and the Clearing House, a trade association of large banks, sued the New York Attorney General, seeking an injunction against investigation of disparities in the subprime lending of Wells Fargo and others...
Update
of June 6, 2005: The Wall Street Journal of June 1 reported on
Wells Fargo
lowering fees -- but only for some customers, in seeming contradiction
of the CRA, both
letter and spirit: “In order to qualify for the lower costs, customers
must have at
least $25,000 in combined balances across deposit accounts they have at
the bank, such as
checking, savings accounts, certificates of deposits and individual
retirement accounts,
as well as any brokerage accounts. Credit-card balances, auto loans and
as much as 10% of
any mortgage balances with the bank are also included.”
Hmm...
Update
of May 31, 2005: Predatory
lending is
not limited to mortgages, and is also being exported, including by
Wells Fargo. For
example last week Furniture First, “a national buying group serving the
retail home
furnishings industry,” signed a contract to offer a private label
credit card program
through Wells Fargo Financial Retail Services. The press release
specified: “Wells
Fargo Financial Retail Services, headquartered in Des Moines, Iowa,
specializes in
providing private label and dual-line credit card programs to retailers
in North America.
Its parent is Wells Fargo Financial. Wells Fargo Financial, a unit of
Wells Fargo &
Company, is a $38 billion company providing consumer installment and
home equity lending,
automobile financing, consumer and private label credit cards and
commercial services to
consumers and businesses. The company has approximately 19,000 team
members and operates
in 48 U.S. states, the 10 provinces of Canada, the Caribbean, Latin
American and the
Pacific Rim.”
Update of May 23, 2005: ICP on May 20 submitted to the Florida Attorney General’s office an analysis of and demand for action on the glaring disparities in Wells Fargo’s 2004 mortgage lending in Florida:
Whites:
71,777 applications,
leading to 10,071 denials (14.03% denied) and 50,226
originations; 2636 [or 5.25%] exceeded rate spread.
African Americans: 6694 applications, leading to 1922 denials
(28.71% denied, 2.05
times higher than whites) and 3589
originations; 855 [or
23.82 percent] exceeded rate spread [4.54 times higher / more likely to
be over rate
spread than whites].
Latinos: 18,729 applications, leading to 2636 denials (20.71% denied, 1.48 times higher than whites) and 7754 originations; 378 [or 4.87 percent] exceeded rate spread [0.93 times “higher” / more likely to be over rate spread than whites].
The Florida AG’s office has confirmed receipt... For or with more information, contact us.
Update of May 16, 2005: This week
we step back,
temporarily, from drilling ever-deeper into the 2004 Home Mortgage
Disclosure Act data.
Because we’ve been asked about the Wells Fargo - America’s Servicing
Company, we
note that Fitch’s September 21, 2004, ratings press release states that
“Wells
Fargo's third-party servicing division, America's Servicing
Company (ASC), services more than 184,000 loans totaling over $20
billion.”
Update of May 9, 2005: ICP Fair
Finance Watch
continues drilling deeper into the 2004 Home Mortgage Disclosure Act
data. Following its petitioning last week
of state
attorneys general, ICP was asked to produce a study of disparities by
gender as well as
race. The results, being forwarded to those who requested them, are not
pretty.
Here’s Wells Fargo:
White men: 554,755 originations of which 36,012
(or 6.49%) were at
rate spread
White women: 196,396 originations of which 21,514
(or 10.95%)
exceeded the rate spread (1.69 times higher / more likely to be rate
spread than white
men)
African American men: 29,858 originations of which
6357 (or 21.29%)
exceeded the rate spread (3.28 times higher / more likely to be rate
spread than white
men)
African American women: 25,278 originations of
which 7067 (or 27.96%)
exceeded the rate spread (4.31 times higher / more likely to be rate
spread than white
men)
Hispanic men: 55.126 originations of which 5763
(or 10.45%) exceeded
the rate spread (1.61 times higher / more likely to be rate spread than
white men)
Hispanic women: 19,276 originations of which 2843
(or 14.75%)
exceeded the rate spread (2.27 times higher / more likely to be rate
spread than white
men)
ICP has provided this and other analysis to the regulators and
state attorneys
general, demanding investigation and action.
And
here comes trouble: a building permit in Annapolis, Maryland for Wells
Fargo Financial, at
167 Jennifer Road...
Update of
May 2, 2005: At last week’s shareholders’ meeting, faced
with
criticism of his involvement on the boards of three other companies
(Cargill Inc., Target
Corp., and Cisco Systems Inc.), Dick Kovacevich insisted
that he gains insights into agriculture, retail, and technology from
those companies, and
that the insights benefit Wells. (Why then
he
doesn’t serve on the board of directors of a payday lender is unclear,
since Wells
proudly and defiantly wants to continue lending to them).
When the shareholder suggested that the CEO was
spreading himself too thin,
Kovacevich quipped, "You sound like my wife." We could joke, but this
is a
family newspaper -- most of the time, at least. Wells
Fargo’s disparate lending has now been raised to ICP/FFW to the
attorneys general not
only in New York but in dozens of other states. We’ll
see.
Update of April 25, 2005: Inner
City Press / Fair
Finance Watch has reviewed, now for the New York City Metropolitan
Statistical Area, the
2004 Home Mortgage Disclosure Act data of Wells Fargo, including the
new information
concerning which loans are subject to a rate spread (3% higher than
comparable Treasuries
on a first lien, and 5% on a subordinated lien), and has found the
following:
Whites: 11,028 originations of which 218 (or
1.98%) were at rate
spread
African Americans: 1756 originations of which 224
(or 12.76%) were at
rate spread (6.44 times higher / more likely to be rate spread than
whites)
Latinos: 1664 originations of which 74 (or 4.45%)
at rate spread
(2.25 times higher / more likely to be rate spread than whites).
The ICP Fair Finance Watch is on the case, for now analyzing Wells Fargo’s 2004 mortgage data in other markets.
Update of April 11, 2005: After
first providing its
2004 Loan Application Register data in PDF format -- to prevent
analysis, it seems clear
-- Wells Fargo last week after complaints decided to provide it
analyzable form. The results are not
pretty: At Wells Fargo for home
purchase loans, African Americans borrowers are 3.9 times more like to
receive a rate
spread loan that white borrowers. This is only slightly less disparate
that Citigroup, at
which African Americans borrowers are 4.34 times more like to receive a
higher-cost rate
spread home purchase loan that white borrowers. Meanwhile, Wells Fargo
denies the
applications of African Americans for home purchase loans 2.3 times
more frequently than
those of whites, nearly as disparate as Citigroup’s 2.6 to one denial
rate ratio
between African Americans and whites.
At Wells Fargo for all types of mortgage loans, African
Americans are 3.19 times
more like to receive a rate spread loan than white borrowers. As we’ve
noted, Wells
Fargo is also a major funder of payday lenders, including targeters of
military personnel
such as Armed Forces Loans, Inc.. ICP has raised this directly to Wells
Fargo, and to the
Federal Reserve on Wells’ proposal to acquire First Community Capital
Corp., which
was announced back on September 2, was challenged by ICP on November 1,
and which still
remains pending, more than five months later. ICP has now put in a
supplemental comment.
Developing...
Update of April 4, 2005: This
week it’s
logistic. On February 28, ICP Fair Finance Watch made a formal request
for Wells
Fargo’s 2004 mortgage lending data; the data by regulation must be
provided “by
March 31 for a request received on or before March 1.” ICP’s request,
directed
to the signer of Wells Fargo’s previous responses to ICP’s regulatory
comments,
also inquired as a fair lending matter about Wells Fargo’s “safeguards,
if any,
for purchasing from, securitizing or serving as trustee for and
otherwise assisting
(including through warehouse lending) other subprime lenders, including
payday lenders and
car title lenders.”
Wells Fargo waited the full month, then on March 31 provided its
data -- in PDF. In
this format it cannot be cumulated and analyzed and Wells Fargo knows
this. ICP wrote to
Wells Fargo
“immediately -- including in the context of Wells
Fargo’s
pending application to acquire First Community, on which ICP is a
timely commenter and
wishes to supplementally comment on the 2004 data -- to bring this to
your attention”
and re-requesting that the data be “provided in a single .DAT file,
allowing analysis
of the entire conglomerate’s patterns at one time.”
ICP has also
complained
to the Federal Reserve. Click here
Update of March 28, 2005: Among the range of Wells Fargo’s predatory
practices is the stealth almost disavowed “America’s Servicing Company,
on which
we’ve previously reported. Among the week’s mail were these two,
further on
Wells’ ASC:
Subj: ASC IS NORWEST
Date: 3/24/2005 8:28:54
PM Eastern Standard
Time
From: [ ]
To: WellsWatch [at]
innercitypress.org
I got a mortgage from
Argent loan and sold
to Ameriquest then to ASC which ended up as in CA.
ASC
do not have any license as dept. of corp and dept of real
state. Also my search
about "
http://www.ascservicing.com " I found out ASC are same as Norwest also
sub for wells
fargo and as 3/4/2005, ASC has some legal cases under
National City Home Loan, HSBC Bank, Wells Fargo Home
Mortgage, and more. ASC
as "servicer" for all but do not have license in ca. or others too. I
called
more than 10 times and no one provide me any info all is secret only
one person told me
call BBB. What about government agency?
Yep - Federal
Reserve,
OCC, the states (send a cc to Inner City Press if you like).
Subj: America's
Servicing Company
Date: 3/25/2005 4:09:00
PM Eastern Standard
Time
From: [ ]
To: WellsWatch [at]
innercitypress.com
In 2004 I built a home.
I had a
construction loan through a local bank. Permanent loan was then
obtained through RBC
Centura bank. This loan was sold to ACS.
Problems arose after ACS
purchased loan. I
was never notified that ACS had purchased loans. I continued to send my
mortgage payment
to RBC... RBC forwarded the installments to ACS for the first 60 days
after they had sold
loan to ACS. The installments RBC received from me after the 60 day
time frame were
returned to me with a letter stating they had sold loan to ACS in
December of 2004 and had
been forwarding my payments. The letter also advised the new mortgage
company should
contact me with account information etc.... I never received any
notification that ACS had
purchased the loan. I learned that I was in default and that I was
placed in collections.
I have Made repeated attempts to contact ACS to have this situation
resolved to no
avail....
Not only does this
company not comply with
fair lending and credit practices, they place accounts in collection
without due course
and process and without notification that they are the lender/mortgage
company....
This has placed a burden
on me as to impact
to my credit standing and ability to obtain a mortgage with a reputable
company. I am subjected to increased cost
of payments,
increased interest rates and will be forced to pay additional fees to
obtain
refinancing...
That’s Wells
Fargo...
Update of February 28, 2005: We'll focus this week
on three sides of
Wells Fargo: stealth servicing, disparate treatment, and the push into
subprime. Last week
(below), we reported on complaints about America's Servicing Company,
including a request
to know who owns it. ICP went
online
Our noting
this
has given rise to more inquiries. For example:
Subj: ASC bka
Wells Fargo
Date: 2/24/2005
1:06:56 PM Eastern
Standard Time
From: [ ]
To: WellsWatch
[at]
innercitypress.org
I just recently
stumbled across your
web page while i was doing some research about America's Servicing
Company.
I am really
troubled about some
practices and recently found out that they are the same as Wells Fargo. ASC is currently my mortgage lender but i was
offered a small loan in the month of December from Wells Fargo which I
accepted....and
they never indicated that they are the same as ASC.
I
have been bombarded since then with phone calls from various offices of
Wells Fargo (with
all of my credit and personal info, I might add) offering to re-finance
me with a 15 year
lower interest rate (all financing and fees included i’m sure). They have mailed me information and are
constantly
calling. They asked me who I was currently
with and I told them ASC. They never
indicated
that they were the same. When I filed my
taxes, the tax preparer found that ASC and Wells Fargo had the same ID
or tax number
(meaning they are the same company?). I
just
spoke with the representative in the office of Wells Fargo and he said
that he doesn't
know who ASC is and they have no affiliation and not the same. He said that they are a publicly traded (what
does
that mean) company and have no affiliation with Wells
Fargo.....needless to say, at this
point i don't believe him.
When I went to
the web site i typed
in subsidiaries of ASC and guess what came up.....yep, Wells Fargo.
This is unfair and deceptive practices.
We agree... Another
Wells
Fargo complaint received last week:
Date: 2/24/2005
5:39:57 PM Eastern
Standard Time
From: [ ]
To: WellsWatch
[at]
innercitypress.org
I
am an Anglo massage therapist in Napa, CA...an area with a large
Hispanic population. Our chiropractic
office has two Anglo employees and
three Hispanic employees. Yesterday, Dr.
Brackett sent out Lupe, the Hispanic receptionist to cash a check at
Wells Fargo for petty
cash. Because she didn't have a bank
account
there, they charged Lupe $5 to cash the check and required two IDs, and
a thumb print. When I have gone there to
cash personal checks for
my mother along with a business check for my pay, they have required $5
from me... but no
extra ID and no thumb print. My mother's personal
check for a much greater amount is never any problem.
So, this was my
theory...Wells Fargo
charges $5 to cash business checks here in Napa because they can get
away with it. Of course I wasn't going pay
$5 to cash my check so
I just took it to my mother and she cashed it for me.
But a migrant worker doesn't have the resources I do. So, the next day, Tara Booth, the Anglo office
manager went in to cash another check to test my theory that Lupe
Valasquez was
discriminated against...and they not only didn't charge her the $5 but
they didn't require
any extra ID! I know it is tiny compared to lending practices
discrimination...but it
really makes us mad!
Us too (or,
grammatical but stilted, “we as well”). And yet another:
Subj: Wells Fargo
nightmare
Date: 2/24/2005 5:51:40
PM Eastern Standard
Time
From: [ ]
To: WellsWatch [at]
innercitypress.org
Below is my letter to
Wells Fargo, I have
had no resolution. I ended up signing at a
9.9% interest rate (I was leaving 5.5% on my construction loan) for no
reason. My credit score is 636 when I view
it—they
claim it is 580 but won’t show it to me. I
had no choice but to close as they kept me waiting until I was in a
bind. They then made me sign two papers,
both of which I
was told if I did not sign, I could not get the loan...
Please publish my story as it is a nightmare!
MY LETTER – No response
yet
Wells Fargo Financial
Des Moines, IA 50309
To:
Thomas
Shippee, Alan Blenner, David Kvamme, Michael McCoy & Dennis Young
I am writing this letter
out of total
frustration so that you can see what is going on with your company at
the local level.
I am a real estate agent in Mississippi. I have recently built a home and wanted to get permanent financing and pull my down payment back out. (I put down $33,000 on the home). I have several connections in Mortgage brokerage but I had recently heard that Wells Fargo was doing home mortgages in the prime market so I called the Jackson, Mississippi office, located on county line road. I was asked to come in. My husband and I went into the office and gave our information and had our credit checked. We were told that we could get a home mortgage for 6.5 %. This was one percent lower than the rate I currently had and I was told that because of my credit, I could never get the 5.5% again. They said that they only use Trans Union and my score with them was 580. My score has never been 580 with anyone. I told them that I checked with all three agencies and my lowest score was 625. They said that they figured it differently than I did. Is a FICO score not the way to figure it? I didn’t understand this but I told them that I would take the higher rate if I could pull out at least $20,000 ( My loan with the bank was for $206,000.) I was then told that if my home appraised for $250,000 or above, I could pull this money out and refinance the house at 6.5% on a three year ARM. I told them okay and waited. Two weeks later, after accumulating all of the paperwork, the appraisal came back at $265,000. I was then told that it did not appraise high enough for me to pull the cash out. I was told that they could refinance it but not pull the money out. Why, I asked would I refinance at one percent higher rate and not pull money out? I then inquired about a home equity loan or any type program where I could keep my original mortgage and just borrow against the equity. I was told “they didn’t do that anymore” and I would have to refinance the entire home. They offered me a rate of 7.25%. Ben (the Manager) told me that I should
