Wells Fargo Execs Allegedly Knew About Auto Insurance Overcharges
Nov. 7, 2018—Wells Fargo executives were warned that an auto insurance plan could be overcharging customers four years before the bank scrapped the program, according to a complaint released by a judge this week, according to the Insurance Journal.
Several executives, including then-general counsel James Strother and chief auditor David Julian, were among the bank officials briefed in 2012 about possible flaws in the auto insurance program that was ended in 2016, according to parts of a class-action lawsuit that were unsealed on Monday.
A Wells Fargo official declined to comment for the report, regarding the allegations in the lawsuit but said the bank intended to repay all customers who were hurt.
Wells Fargo ended its auto insurance program in Sept. 2016 after an internal review found many customers were being wrongfully saddled with a costly product they did not need, reported Insurance Journal. The bank had a right to force auto borrowers into the product called ‘collateral protection insurance’ (CPI) if they let their own policies lapse. But ultimately, the bank said some 600,000 customers were forced into CPI unnecessarily when it reached a $1 billion regulatory settlement in April.