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Regulators slap bank hard for improper vehicle repossessions

On Behalf of | Oct 10, 2016 | Repossessions

Wells Fargo Bank has been on the receiving end of stern criticism over the past months for a scheme that involved more than a million fraudulently opened bank accounts. While that scandal has engulfed the company in controversy, a less-publicized scandal has mostly flown under the media’s radar.

Wells Fargo was recently fined $24 million by regulators for improper vehicle repossessions. The company repossessed cars from military personnel without first getting the required paperwork. 

As part of part of the resolution of the matter, a bank subsidiary, Wells Fargo Dealer Services, has agreed to change its methods. More than 400 vehicles were repossessed without needed court orders, the Department of Justice said.

An investigation of the bank began when a soldier who was getting ready for an Afghanistan deployment had his car improperly repossessed. The vehicle was sold at auction and the bank then tried to collect more than $10,000 from the serviceman and his family.

An investigation revealed a pattern of similarly unlawful repossessions by Wells Fargo.

The settlement covers repossessions carried out over a 7-year span ending in July of last year. Each service member affected will receive $10,000 from Wells Fargo, as well as any lost vehicle equity, plus interest.

The violations covered by the agreement are also the reason for a $20 million fine by the Office of the Comptroller of the Currency, an independent bureau of the Treasury Department.

An experienced Philadelphia consumer protection attorney can help you fight back against improper vehicle repossession. At Bensley Law Offices, we protect your rights and your interests in all matters.

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