Wells Fargo sued by Los Angeles over 'fraudulent conduct'

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Wells Fargo is being sued by the city of Los Angeles for allegedly opening accounts and issuing credit cards without customers' authorization. (KABC)

Wells Fargo is being sued by the city of Los Angeles for allegedly opening accounts and issuing credit cards without customers' authorization.

A complaint was filed in state court on Monday under an unfair-business-practices law that permits attorneys representing large California cities to seek redress for customers throughout the state.

City Attorney Mike Feuer says the bank encouraged its employees to engage "fraudulent conduct" through a culture of high-pressure sales. Feuer is expected to provide more details at a news conference on Tuesday.

"Wells Fargo has known about and encouraged these practices for years. It has done little, if anything, to discourage its employees' behavior and protect its customers," the lawsuit states.

"The result is that Wells Fargo has engineered a virtual fee-generating machine, through which its customers are harmed, its employees take the blame, and Wells Fargo reaps the profits," the lawsuit continued.
Wells Fargo has issued a statement saying it will vigorously defend itself against the allegations.

"Wells Fargo's culture is focused on the best interests of its customers and creating a supportive, caring and ethical environment for our team members. This includes training, audits and processes that work together to support our vision and values and our commitment to customers receiving only the products and services they need and will benefit from," the bank said in a statement.

The company has not denied the actions alleged in the suit. Instead, they blame some rogue employees for hacking into customers' accounts and creating bogus credit cards.

The lawsuit seeks penalties of up to $2,500 for every violation and restitution for customers who were harmed.

The Associated Press contributed to this report.
Related Topics:
businessbankwells fargolawsuitconsumercaliforniaLos Angeles
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