DALLAS – A Texas law firm has sent a letter to Wells Fargo asking the bank not to place any conditions on refunds to as many as a half-million customers allegedly charged for auto insurance they did not ask for or need.
Law firm Baron and Budd, which has headquarters in Dallas, has sent a letter asking the bank not to try and force conditions on those refunds. It filed the first law suit connected to the alleged overcharging July 30.
The embattled bank, already under fire over opening accounts for customers allegedly without their consent, announced it would pay $80 million in refunds after the charges were publicly revealed.
Some 800,000 customers are reported to have paid unwanted or needed collision insurance. As many as 274,000 found themselves in delinquency with 25,000 wrongfully repossessed, according to Baron and Budd press release.
The letter was sent in light of media reports indicating that Wells Fargo intends to refund insurance premiums paid by certain customers, Roland Tellis, head of the law firm's consumer class action group, told Megadealer News in a statement.
"In light of media reports indicating that Wells Fargo intends to refund insurance premiums paid by certain customers, as well as the bank’s track record of trying to force customers into private arbitration, we felt it necessary to caution the bank that unilateral communications from a class opponent to the class may be considered coercive and require court supervision,” Tellis said. “Wells Fargo has now been put on notice that any attempt to condition refunds on a customer's waiver or release of any legal rights will be met with vigorous opposition.”
Baron & Budd filed the lawsuit in U.S. District Court in San Francisco.
"In addition to notifying the bank to refrain from conditioning refunds, the letter instructs Wells Fargo to preserve all documents, tangible things and electronically-stored information potentially relevant to the case," another press release from the law firm states. "The letter also includes a reminder that the destruction of evidence when litigation is anticipated or has commenced has both civil and criminal implications."
Wells Fargo recently announced that Stephen W. Sanger, 71, will retire as chairman at the end of the year, while two other directors also will be leaving.
The bank revealed last September that its staff, in a bid to hit sales targets, opened millions of unwanted bank accounts for customers who never asked for them.