SAN FRANCISCO — Wells Fargo is facing a new lawsuit in California that accuses the bank of quietly charging improper “float fees” to mortgage borrowers for years—and then attempting to cover it up with vague refund notices and unexplained payments, HousingWire reported.
The class-action complaint, filed July 15 by borrower Lance Baird and first reported by Law360, alleges the bank systematically added float fees during the mortgage origination process without proper disclosure or customer consent. Float fees typically allow borrowers to delay locking in their interest rate, but Baird says he never agreed to the charge.
The issue came to public attention in 2022 when Wells Fargo began sending letters to borrowers, acknowledging it had mistakenly charged the fees. Enclosed in the letters were cashier’s checks and an apology, but little explanation, HousingWire explained.
Baird received a $3,000 check, more than $2,000 of which was labeled a float fee refund—though he claims he never opted for the float-rate feature. According to the suit, Wells Fargo failed to explain how the float fees were calculated, or how the refund amounts were determined, leaving borrowers unable to understand the full extent of the financial harm, HousingWire said.
The lawsuit alleges the misconduct spanned over a decade and accuses the bank of engaging in a “throw-away effort” to minimize its liability, shifting the burden onto customers to discover and prove the damages themselves, HousingWire added.
“Wells Fargo tiptoes around the issue by putting the burden on the consumer to figure out whether the amount offered was sufficient to cover the damages caused, when Wells Fargo knows they did not,” the complaint states.
The suit, seeking class action certification, includes over 100 members, with potential damages exceeding $5 million, excluding attorney fees and other costs, HousingWire said.