Minnesota AG Swanson: Wells Fargo customers should be able to sue

REUTERS/Chris Keane

Do you think? At MPR, Martin Moylan reports, “Minnesota Attorney General Lori Swanson wants Wells Fargo to let customers sue the bank to resolve disputes over accounts opened without customer authorization. That means Wells Fargo would have to forgo enforcing a mandatory arbitration clause included in customer agreements. Swanson wrote to Wells Fargo CEO John Stumpf asking the bank to let customers have their day in court if they wish. She said it was absurd for the bank to insist on arbitration in regard to millions of accounts that customers didn’t want or authorize.”

Also, Suzanne Barlyn of Reuters reports, “The scandal over improper sales practices at Wells Fargo & Co extended to thousands of small-business owners, according to a U.S. lawmaker, raising questions about the scope the bank’s issues with unauthorized accounts. In a Sept. 29 letter viewed by Reuters on Tuesday, Sen. David Vitter, a Louisiana Republican, demanded that Wells Fargo Chief Executive John Stumpf provide a ‘full accounting’ of customers affected. … Discussions between congressional staffers and Wells Fargo ‘have indicated that the fraudulent activity of your employees was not limited to Wells Fargo’s consumer banking operations,’ Vitter wrote. 

And now Hillary’s on ‘em. For Mother Jones, Hannah Levintova says, “During a campaign stop in Toledo, Ohio, on Monday, Hillary Clinton promised to hold Wells Fargo accountable for a fake-account scandal that has already led to a $190 million fine for the bank, a Department of Justice investigation, lawsuits by former employees and shareholders, and a pummeling of the Wells Fargo CEO by senators during a September hearing. … 

Also worth reading: a New Yorker piece by Sheelah Kolhatkar, who says, “During the hearing before the House Financial Services Committee last week, Keith Ellison, the Democratic congressman from Minnesota, skipped over the discussion of Stumpf’s compensation and focussed on the hourly workers who were, apparently, incentivized by their superiors to open fake accounts in the first place. … The congressman seemed to be asking the C.E.O. of one of the nation’s largest financial institutions how his company could possibly have come to adopt some of the same pushy sales techniques that were in place at Stratton Oakmont, the boiler-room brokerage in ‘The Wolf of Wall Street.’ In addition to highlighting some of the similarities between those two, disparate ends of the financial industry, what went on at Wells Fargo perfectly illustrates the way that the financial sector has, and has not, changed since the financial crisis of 2008 exposed so many of its problems.” 

 Joe Carlson of the Strib reports, “Medicare’s fiscal watchdog has documented $1.5 billion in spending on seven types of defective heart devices that doctors implanted in thousands of beneficiaries. … Their examination, which has been underway for about a year, resonates in Minnesota, home to cardiac divisions of the world’s largest heart-device makers: Medtronic PLC, St. Jude Medical Inc. and Boston Scientific Corp.” 

Entirely by coincidence, I’m sure, health law professor David Feinwachs has this to say in a Strib commentary. “I have watched for many years as Minnesota’s nonprofit health plans continue to victimize the citizens of this state by overbilling the taxpayers for their self-reported, unaudited and inflated cost claims. I have been amazed by the complete lack of any oversight by our state agencies and frustrated by the apparent lack of interest that the overwhelming majority of legislators has displayed in the health care crisis that now threatens to destroy any reasonable expectation of access to quality care at an affordable price.

Sayeth the Bard of Anoka, Garrison Keillor, in The Washington Post: “It’s been one First after another. First candidate to offer a health plan described only as really ‘beautiful’ and ‘unbelievable.’ First ever to brag about his penis. First to be endorsed by the National Enquirer. First to have gone through six bankruptcies. First to say about his opponent’s TV ads: ‘It’s not nice. And I don’t deserve that.’ Did Barry Goldwater say of LBJ, ‘He’s not nice to me’? I frankly doubt it very much. And what candidate has seen his name so often in the same sentence with Mussolini’s? … I’m a tired old liberal. I don’t need a revolution; amiable competence is good enough. Decent schools, great hospitals, buses that run on time, smart cops, and programs for the autistic kids that there seem to be so many more of.” 

Just first-degree Bern. Says Esme Murphy for WCCO-TV, “Hillary Clinton’s campaign brought Bernie Sanders to Minnesota Tuesday to encourage his supporters to back her. Sanders campaigned at the University of Minnesota in the Twin Cities, and then traveled to the University of Minnesota Duluth. He crushed Clinton in Minnesota’s caucus last winter 62 to 38 percent — a win fueled largely by younger voters. Minnesota Republicans say Sanders’ visit shows just how concerned the Democrats are about Minnesota.”

Savvy mutt. Rochelle Olson of the Strib writes, “An Inver Grove Heights dog survived six months alone in the wilderness of Eagan before an animal control officer found her and captured her and got her home. … Turns out construction workers in a new Eagan development were familiar with the dog and had been feeding her for a few weeks.”

That Ryder thing was big biz for Airbnb. Says Frederick Melo in the PiPress, “The Ryder Cup didn’t just flood Twin Cities hotels with American and European golf fans. It also filled plenty of houses throughout the metro, thanks to home-share websites such as Airbnb.com. The San Francisco-based company on Tuesday released a county-by-county breakdown of guest stays during the international golf tournament, which opened Friday and continued through Sunday. In total, 3,444 confirmed guests stayed in Hennepin, Ramsey, Scott and Carver counties during the week of the Ryder Cup, a 163 percent increase over a typical week. Some 215 guests were able to stay in the Carver County city of Chaska, which is home to the Hazeltine National Golf Club.”

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Comments (5)

  1. Submitted by Aaron Olson on 10/05/2016 - 07:39 am.

    Wilderness…

    of Eagan

  2. Submitted by Tom Clark on 10/05/2016 - 08:36 am.

    About Bernie Sanders

    I’m guessing the reason for his visit is that the Democrats want to boost turnout to win other races down the ballot. If anyone thinks Trump has a chance of winning Minnesota, I’ll be happy to take that bet.

  3. Submitted by Greg Kapphahn on 10/05/2016 - 09:55 am.

    Well’s Fargo’s “Cross-selling” Accounts

    It seems to me that, since these millions of accounts were opened WITHOUT the knowledge or approval of Well’s Fargo’s customers,…

    and the customers who were damaged by the opening of those accounts,…

    NEVER signed Well’s Fargo’s standard customer agreement for those specific accounts,…

    the agreement requiring (the house always winds) arbitration of customer disputes with Wells Fargo,…

    does NOT apply to those accounts.

    The door should be WIDE OPEN for massive customer law suits under these circumstances.

    Wells Fargo deserves to GO DOWN (i.e. out of business) as the result of their fraudulent dealings with their customers.

    If they don’t, there’s nothing to stop other banks from doing the same thing,…

    expecting that they’ll be able to get away with it, too,…

    with nothing more than a slap on the hand penalty if they’re caught.

    • Submitted by Robert Owen on 10/05/2016 - 06:07 pm.

      Go Down?

      Put Wells Fargo out of business? With 265,000 employees around the world, many of them not involved in banking sales, you don’t think that’s a bit harsh putting all those people out of jobs?

  4. Submitted by James Hamilton on 10/05/2016 - 11:12 am.

    Unconscionable arbitration clauses

    While I don’t care greatly for what I believe is AG Swanson’s tendency to promote herself, I do believe it’s time for laws regulating the use of arbitration clauses in consumer contracts. Such clauses have their place in agreements between business entities when agreed to by both parties and are not simply the result of unequal bargaining power between them. They have no place in contracts of adhesion, i.e., “Take it or leave it” agreements between parties with greatly different bargaining power.

    Arbitration has been successful in many areas, such as the construction industry. It has failed miserably in others, such as Minnesota’s No Fault Insurance Act and the Federal Lemon Law governing defective motor vehicles. Why? Because too often the process is captured by one side of the table or another, frequently due to the financial interests of the arbitrators themselves.

    Any candidate for office looking for a consumer-oriented pitch could do worse than propose such a ban, whether at the state or federal leve.

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