Wells Fargo’s refusal to allow customers to sue for damages in relation to the unauthorised accounts scandal is being challenged by Democratic Congressman ShermanBrad Sherman. Although the bank, the third-largest in the US by assets, has promised to reimburse affected customers, an arbitration clause has prohibited such customers from pursuing lawsuits. Brad Sherman’s bill, originally written last year and now reintroduced, would override this clause. If passed, the bill would apply to all banks. Last year, Wells Fargo agreed to pay $185m in fines following revelations that over 2 million accounts had been opened without authorisation.
Wells Fargo’s refusal to allow customers to sue for damages in relation to the unauthorised accounts scandal is being challenged by Democratic Congressman Brad Sherman. Although the bank, the third-largest in the US by assets, has promised to reimburse affected customers, an arbitration clause has prohibited such customers from pursuing lawsuits. Sherman’s bill, originally written last year and now reintroduced, would override this clause. If passed, the bill would apply to all banks. Last year, Wells Fargo agreed to pay $185m in fines following revelations that over 2 million accounts had been opened without authorisation.