Wells Fargo Faces Class Action Lawsuit
The bank has been accused of forcing responsibility on customers for unauthorized transfers
July 8, 2024 06:14 AM
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TL;DR Wells Fargo is embroiled in a proposed class-action lawsuit. The plaintiffs claim the bank broke the law by not reimbursing unauthorized transfers. The case highlights critical concerns about the Electronic Funds Transfer Act.
New Class-Action Lawsuit Hits Wells Fargo
Wells Fargo is facing a new proposed class-action lawsuit, accused of breaking the law by forcing customers to accept responsibility for unauthorized transfers. The suit, filed by Jennifer Rice and Erik Westervelt in a Pennsylvania federal court, alleges Wells Fargo routinely violates the Electronic Funds Transfer Act by not reimbursing victims for their losses.
The Incident
In December 2023, the couple says they received a call from someone claiming to be from Wells Fargo. The caller informed them that they had detected a fraudulent wire transfer on their account for $24,557.89.
The person on the phone said they could halt the transfer as long as Westervelt could confirm the six-digit code sent to him via text message. When Westervelt confirmed the code, the $24,557.89 vanished from their joint account via wire transfer to an unknown user at Discover Bank.
Immediate Action
After realizing he had been speaking with a con artist, Westervelt immediately went to the local Wells Fargo branch to report what had happened. The bank's fraud department confirmed that the money had left his account and that they would investigate the incident.
But after seven days, Wells Fargo called Westervelt and Rice to inform them they would not be reimbursed because they were the ones that "authorized" the transfer. The pair says they did nothing of the sort and claim that Wells Fargo went back and forth multiple times between promising to reimburse them and then reversing its stance.
Legal Grounds
The plaintiffs reference the Electronic Funds Transfer Act, which states, "A consumer is not liable for any unauthorized electronic fund transfer unless such transfer was made using an accepted card for the account and the issuing institution has provided a means to identify the person using said accepted card."
Westervelt and Rice are seeking statutory damages of $1,000 per class member, plus fees, costs, and a jury trial.
"A consumer is not liable for any unauthorized electronic fund transfer unless such transfer was made using an accepted card for the account and the issuing institution has provided a means to identify the person using said accepted card."
Ongoing Battle
This case could set a significant precedent for how banks handle unauthorized transfers and their responsibilities under the Electronic Funds Transfer Act.
Many who have faced similar issues eagerly await the outcome, as it could lead to industry-wide changes and improved consumer protections.