Wells Fargo class action overview:
- Who: A North Carolina federal magistrate judge granted Wells Fargo Bank’s motion to compel arbitration for allegations it overcharged military members on rates and banking fees.
- Why: The judge ruled the plaintiffs’ credit card accounts were opened before the Military Lending Act and its bar on mandatory arbitration was expanded.
- Where: The Wells Fargo class action lawsuit was filed in North Carolina federal court.
A federal magistrate judge in North Carolina has granted Wells Fargo Bank’s motion to compel arbitration for claims alleging it overcharged military members with excessive rates and banking fees, recommending a proposed class action be dismissed.
U.S. Magistrate Judge Robert B. Jones Jr. ruled the plaintiffs’ credit card accounts were opened before Oct. 3, 2017, when the Military Lending Act (MLA) and its bar on mandatory arbitration was expanded to include credit cards.
“Because plaintiffs’ Wells Fargo credit card accounts were opened prior to credit cards being covered by the MLA and the regulations expressly did not apply retroactively to such accounts, the MLA and its arbitration bar do not apply to plaintiffs’ accounts,” the judge wrote in his ruling.
Carmin Nowlin, Tamika Haley and Jesus Rodriguez filed the proposed class action lawsuit against Wells Fargo in March 2024, alleging it did not waive fees as promised in a Military Benefits Program and charged higher interest rates on credit cards than allowed under the Servicemembers Civil Relief Act (SCRA).
Wells Fargo to refund banking fees to impacted customers, spokesperson says
Judge Jones also rejected arguments that the MLA barred enforcement of an arbitration clause against Rodriguez because he was on active duty when the complaint was filed, noting that his account was also opened before credit cards were covered by the statute.
“Accordingly, the MLA’s arbitration bar does not apply regardless of plaintiffs active duty status when the case was filed,” the judge wrote.
According to a Law360 report, Wells Fargo spokesperson Shea Leordeanu said the bank is committed to supporting military service members and providing benefits and protections under the SCRA.
“We identified certain instances in which customers did not receive reduced interest and/or banking fees during SCRA eligibility periods. We are refunding those impacted customers,” Leordeanu said.
What do you think of the ruling in this Wells Fargo class action lawsuit? Let us know in the comments.
The plaintiffs are represented by Paul J. Puryear Jr. and Matthew D. Ballew of Ballew Puryear PLLC and Knoll D. Lowney and Claire Tonry of Smith & Lowney PLLC.
The Wells Fargo class action lawsuit is Carmin Nowlin, et al. v. Wells Fargo Bank NA, Case No. 5:24-cv-00179, in the U.S. District Court for the Eastern District of North Carolina.
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