Wells Fargo fights to leave customers excluded from automatic payment plan

WASHINGTON / NEW YORK (Reuters) – Wells Fargo & Co (WFC.N) is fighting to silence some customers of a large compensation plan of about 600,000 drivers who were forced to purchase auto insurance they did not need, according to court documents and a source close to effort.

US regulators fined Wells Fargo $ 1 billion in April for the insurance program and asked the bank to compensate injured drivers. These drivers are also suing Wells Fargo in federal court in California to get more compensation than the bank is willing to pay.

The failed insurance program ran from 2002 to 2016, but the bank's only goal is to compensate drivers forced to sign up for a policy as of 2005, Wells Fargo told the judge. federal government to oversee the case.

Wells Fargo's reluctance to compensate all drivers contradicts his commitment to helping every injured client, which could heighten control over the scandal-stricken bank.

Drivers' lawyers have argued that the compensation plan should cover the entire life of the insurance program, but the bank is not convinced, according to court documents obtained by Reuters.

"There is no credible reason not to go back to the beginning of the program," driver lawyer Roland Tellis told a hearing in August.

Tellis did not respond to requests for additional comments.

Tim Sloan, Managing Director of Wells Fargo, told lawmakers last year that the bank "is working diligently to make things right for every injured client."

At the same hearing, a lawyer at the bank claimed that the bank had already been "compromised" by allowing payments between 2005 and 2016, according to the court's official record.

Wells Fargo has records on the first three years of the insurance program, but these are kept in a separate database of 2005-2016 files, the lawyer said. He did not explain why the bank did not want to access the previous database and refused to give details during his contact with Reuters.

Any driver who believes he or she has been injured in the insurance program can contact the bank directly and make a claim, said a spokesman for the bank.

"We invite them to contact us with their insurance information," Wells Fargo said in a statement to Reuters.

Tellis and other lawyers want a payment over three times the amount charged to drivers, which could add costs and uncertainty to a scandal that continues to worry investors.

The final terms of the private litigation could affect the current remediation plan that the bank has agreed with the federal regulators.

The Bureau of Consumer Financial Protection (CFPB) has authorized the bank to limit its payment plan to the period from 2005 to 2016 in its settlement reached in April with the bank. A spokesman for the office declined to comment on the scope of the payment plan.

The Office of the Controller of Money (OCC), which participated in the fine of April, declined to comment. The STO's regulations have not set a precise deadline for payments.

Over the summer, the OCC rejected the bank's plan to reimburse customers to Joseph Otting, the manager of the OCC, informing lawmakers in October that he was "not in the mood". "with the efforts of the bank.