Van Hollen, Brown Introduce Bill to Get Wells Fargo’s Victims Their Day in Court
U.S. Senator Chris Van Hollen (D-Md.), member of the Senate Committee on Banking, Housing, and Urban Affairs, has joined Committee Ranking Member Sherrod Brown (D-Ohio) to introduce legislation that will give Wells Fargo customers who were victims of a fraudulent account scheme their day in court.
From at least 2011 to 2015 Wells Fargo opened millions of fraudulent accounts - two million bank accounts and 565,000 credit card accounts - in its customers' names. Now Wells Fargo is using the forced arbitration clauses it tucked away in the fine print of contracts customers signed when they opened legitimate accounts to block them from suing over the fraudulent accounts.
Wells Fargo recently fired a group of senior managers amid the bank's ongoing internal investigation of the scandal, but the bank has refused to stop using forced arbitration clauses against defrauded customers.
"It is essential that these victims of fraudulent activities have their day in court and this legislation will help make that happen," said Senator Van Hollen. "I will keep working to strengthen consumer protections to hold big banks accountable."
The Justice for Victims of Fraud Act will work hand-in-hand with a new oversight rule that the Consumer Financial Protection Bureau (CFPB) put out in May to strengthen protections for consumers. Whereas the CFPB proposal would apply only to contracts signed after the rule is final - this bill would allow victims of Wells Fargo's fraud to seek their day in court even if they signed contracts that included arbitration for their legitimate accounts in the past.
The bill is cosponsored by U.S. Sens. Patrick Leahy (D-VT), Patty Murray (D-WA), Ron Wyden (D-OR), Richard Durbin (D-IL), Jack Reed (D-RI), Robert Menendez (D-NJ), Bernie Sanders (I-VT), Robert Casey (D-PA), Sheldon Whitehouse (D-RI), Mark Warner (D-VA), Jeff Merkley (D-OR), Al Franken (D-MN), Richard Blumenthal (D-CT), Brian Schatz (D-HI), Mazie Hirono (D-HI), Elizabeth Warren (D-MA), and Heidi Heitkamp (D-ND).
The bill has been endorsed by Americans for Financial Reform, Public Citizen, NAACP, American Association for Justice, Allied Progress, Center for Responsible Lending, Economic Policy Institute Policy Center, California Reinvestment Coalition, Consumers for Auto Reliability and Safety, Consumer Federation of America, National Consumers League, Public Justice, Franciscan Action Network, Media Voices for Children, Woodstock Institute, Tennessee Citizen Action, National Consumer Law Center (on behalf of its low income clients), National Association of Consumer Advocates, The Impact Fund, Consumer Watchdog, Alliance for Justice, Workplace Fairness, Homeowners Against Deficient Dwellings, Consumer Action, Consumers Union, and Communications Workers of America (CWA).
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