Wells Fargo, vets settle lawsuit over mortgage loans

Written by Biloxi

Another bank is caught with overcharging soldiers. Wells Fargo will pay through the nose (and thanks to two former Wells Fargo employees that swore under oath in a lawsuit, that the charges were no mistake) to the veterans as this story was reported by FOX 5 I-Team last week:

There was good news Wednesday for Veterans across America who may have been overcharged on VA home loans. Wells Fargo settled a class action lawsuit that could put as much as $10 million dollars in the pockets of military veterans.

The settlement follows a FOX 5 I-Team investigation more than a year ago of allegations that various banks overcharged veterans on their VA home loans.

It was a long, at times, tough negotiation between Wells Fargo and attorneys representing veterans who felt they had been overcharged on VA loans.

In the end, Wells Fargo agreed to refund money to 60,000 veterans nationwide.

In 2009, Senator Johnny Isakson called for Senate hearings to determine if banks were overcharging military veterans after learning of FOX 5 I-Team's investigation into allegations of banks defrauding veterans on VA loans. Wells Fargo had responded to FOX 5 I-Team's investigation into the veterans' claims of bank defraud and the promise by the banks to refund them:

Statement #1:

Our VA lending policies are clear: Wells Fargo prohibits charging borrowers any fees not allowed under VA guidelines.

We are reviewing the loans involved in the lawsuit and if we find that unallowable fees were charged, we will refund the customer and apologize for the error.

We deeply respect and appreciate what veterans have done for our country, and remain committed to ensuring that we fairly and responsibly help them with home loans.

Statement #2:

We have industry-leading responsible lending principles that are backed by strong and continuously refined controls.

We are looking into this issue to determine if there were team members or closing agents who knowingly worked around these controls. If we find this to be the case, we will take appropriate action with those involved.

Statement #3 (March 18, 2010)

We worked with all 64 customers who contacted us about their veterans’ loan fees to verify they were appropriately charged. We also re-communicated our expectation that settlement agents who work with us will follow program guidelines. We will continue to work with the Veterans Administration to recommend enhanced practices for the industry, so that veterans can fully understand what they are being charged.

And in the end, Wells Fargo, like JP Morgan Chase and Bank of America of cheating the veterans. Penalties? Yes. Criminal charges? No. And we shall see if Wells, Chase, and Bof A will face criminal charges in violation of the Servicemembers Civil Relief Act.