Wells Fargo Admits 'Computer Glitch' May Have Contributed to 400 Foreclosures
from the scam-after-scam dept
Well shucks, it only seems like yesterday that Wells Fargo first found itself under fire for a cavalcade of fraudulent behavior.
First, the company was busted for creating 2 million unwanted accounts to saddle users with fees in order to meet quarterly numbers. From there, the company was subsequently caught hitting 110,000 customers with inaccurate “mortgage rate lock extension fees” to prevent them from being able to lock in better interest rates. Wells Fargo wagon was then caught forcing more than half a million customers into signing up for auto insurance they didn’t need, resulting in a number of those users defaulting on their loans or having their vehicles repossessed due to unnecessary added costs.
Apparently undaunted by the recently proposed $2.1 billion fine for the mortgage snafu alone, the company this week is making headlines once again. This time, Wells Fargo is under fire for hundreds of customers losing their homes due to an apparent computer glitch. According to the filing, the glitch was found in a mortgage loan modification underwriting tool and resulted in about 625 customers being “incorrectly denied” a loan modification, in turn resulting in about 400 of them being forclosed upon:
“An internal review of the Company’s use of a mortgage loan modification underwriting tool identified a calculation error that affected certain accounts that were in the foreclosure process between April 13, 2010, and October 20, 2015, when the error was corrected. This error in the modification tool caused an automated miscalculation of attorneys? fees that were included for purposes of determining whether a customer qualified for a mortgage loan modification pursuant to the requirements of government-sponsored enterprises…
As a result of this error, approximately 625 customers were incorrectly denied a loan modification or were not offered a modification in cases where they would have otherwise qualified. In approximately 400 of these instances, after the loan modification was denied or the customer was deemed ineligible to be offered a loan modification, a foreclosure was completed.
In subsequent statements to the press, the company insisted it was “very sorry,” but, as has been its tendency, tried to downplay the connection between its screw up and people actually losing their homes:
“About 625 customers were incorrectly denied a loan modification or were not offered one even though they were qualified, according to the filing. In about 400 cases, the customers were ultimately foreclosed upon. Wells Fargo said in a statement that it was “very sorry that this error occurred” and said it was “providing remediation” to the affected customers. A spokesperson for the bank “there’s not a clear, direct cause and effect relationship between the modification” denials and foreclosures, but confirmed customers who were denied modifications lost their homes.”
Perhaps, but at the same time, you should probably look back upon the last two years’ worth of behavior by the company and include that in any mathematical determination of its trustworthiness or competence. According to a the same filing, the company revealed for the first time it’s also the subject of inquiries by more than one government agency into some potentially-shady behavior regarding tax credits attached to low income housing developments:
“Federal government agencies have undertaken formal or informal inquiries or investigations regarding the manner in which the Company purchased, and negotiated the purchase of, certain federal low income housing tax credits in connection with the financing of low income housing developments.”
If these are the scams and screw ups we know about, you have to wonder just how many haven’t been exposed yet. At some point you have to wonder how this particular company is still in business, since this hasn’t just been a few errant fuck ups. It has been a prolonged, active campaign of malice and incompetence, matched only by the company’s fairly obvious disdain for its own customers. At this point, it’s a company that’s starting to make similarly-hated monoliths like Comcast look like valued corporate citizens, and any conversations about more severe penalties are well earned.
Filed Under: computers, foreclosures, fraud, glitch
Companies: wells fargo
Comments on “Wells Fargo Admits 'Computer Glitch' May Have Contributed to 400 Foreclosures”
Undiscovered ...
…but when they are discovered, we will be very sorry about it.
Re: Undiscovered ...
Wells Shrughs has been known for not caring. Firing people for whistleblowing, having a person responsible for finding a reason to fire people, having several scams running against their customers and encouraging the behaiour by giving the responsible bonuses…
Seems like the only solution would be to foreclose on their banking licence. You could always blame it on a glitch!
Seriously, they wonder why the wealth gap keeps growing. How the hell do you stay in business like Comcast and Wells Fargo? I should just go out and start my own business. Rip off all my customers and either claim bankruptcy like Trump or just say “Smack my wrist so I can back to cheating my customers please”
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Market consolidation? Oligopoly?
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Nope. Because their customers aren’t paying any attention to what’s happening and when its pointed out to them they say ‘its just too much effort to change banks’.
If people paid attention and moved when their bank is caught multiple times doing shady shit then there’d be nothing for government to do.
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I moved all my money from Wells Fargo to a credit union after one of the scandals last year.
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You could help people out with some suggestions. There’s a huge number of banks and credit unions, all with a weird mix of fees, ATM availability, customer requirements (some CUs are open to specific groups only) etc. I can’t blame people if a vague suggestion like "switch banks" goes nowhere.
Of course, it’s also hard to tell whether the new bank is better or hasn’t been caught yet. We learned in the S&L crisis that at least a third of S&Ls were poorly managed, in the 80s.
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Do it for the Principle if the fact.
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Who is wondering this? We have a good idea why, and we know why the people in power don’t want it to change.
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Silly Berenerd,
You have to fuck over and rip off a LOT of little people to get away with it.
Oh and don’t make the mistake of ripping off the wealthy and powerful like poor old Bernie Madoff did, because then you’ll actually have to do jail time.
But rip off tons of little people? Funnel a bunch of drug money for the cartels? No problem!
I for one cannot believe that these large banks have any customers at all, let alone the giant base they have.
Just take your business elsewhere ESPECIALLY when you are getting mistreated (or worse).
I believe the phrase was… "Too big to fail."
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Too big to jail
US banking system engaged in egregious behavior. In another news the water is wet. When the US starts whining about whoever destabilizing the world economy just point at themselves with 2008, this kind of bullshit and the newly introduced Trumpian way of business.
dont you love contracts..
You have the right to SIGN one, but can you NOT sign and get the same deals??
THEN in the contract, THEY have the right to change things, but YOU DONT..
Like handing a hungery man a meal, then finding it full of worms,and trying to fight back..NOT EASY..
And how do you MESS up a working program..YOU TRY TO CHANGE THINGS, without a good programmer..
I can see their new commercial now.
“Wells Fargo. Founded 1885, refounded 2018. Re-refounded 2019.’
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At this point, they just need to rebrand themselves. I don’t know anyone who wants to deal with them anymore.
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More like Dumbfounded 2018
What about the courts?
I’m banned from viewing sec.gov, so I can’t see the details… but wasn’t there a court that needed to see proof before allowing a foreclosure? Wikipedia says some state laws allow that to be bypassed, and I wonder whether the victims were in those states. If so, those would be good laws to get legislators to change.
Re: What about the courts?
From the article – it looks like the error meant that some people who were eligble for a mortgage modification were denied it.
The court wouldn’t look at that when determining if a foreclosure were legal as that’s an internal bank decision.
Once the bank had decided to foreclose all they need to show is that they own the mortgage and that the lendee was in default. In this particular case it doesn’t look like WF broke the law (for once) but that their loan program was screwed up.
I was reading a history of the Shootout at the OK Corral recently and a crooked Wells Fargo stagecoach employee plays a central role in the events leading to the gunfight. So basically, nothing has changed.
Too BANK to fail...
1. Open Bank
2. Print Money.
3. Profit.
Due to complex financial framework and legal shenanigans, step 2 may not directly print money, but we will ‘debit’ something somewhere on someone’s account and we will ‘credit’ the Wells Fargo revenue account and when the customers ‘pay’ their bills (aka we draw funds directly out of their accounts) we will end up with the cash.
Step 2 can also be done by shortchanging, swindling, finegaling, hijacking, lying under oath, forging, etc. Just make sure to send the bribe, er ‘lobbying fees’ to the appropriate city,state,federal officials.
Failure to submit the proper bribes will result in possible court cases requiring additional lying, forging, and lobbying to resolve, but we have the resources and are too BANK to fail, so if we screw up big enough the government will just give us more money.
So you have a scheme, plan, world ending scenario you want to try, GO FOR IT, we are WELLS FARGO and we are too big to fail (no matter how hard we try)… really folks, I can’t make this stuff up…
A spokesperson for the bank:
“there’s not a clear, direct cause and effect relationship between the modification” denials and foreclosures, but confirmed customers who were denied modifications lost their homes.”
Yes, funny how that works, innit? Just like “abstinence is 100% effective, and just as honest.
We at Well’s Hospital regret the death of the patient, but there just isn’t a clear, direct cause and effect relationship between not providing them with defibrillation and their death from a heart attack. Not all such cases are responsive to that, and in our estimation, they weren’t good candidates for it. It was just a software glitch anyway, and we have sent cards and flowers to all the funeral homes of the decedents, in recompense.
We look forward to doing business with our valued and loyal customers.
anti big bank is dog whistle code for antisemitism
more sovcits bullshit
Re: Response to: lololol on Aug 7th, 2018 @ 5:38pm
THIS^
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Wait, what?
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It’s blue balls thinking he’s being clever. Or some other random nutter doing a passable imitation of the local nutters tired old tricks.
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or it’s blue balls thinking he’s stupid as some of the dumbfucks here who keep mentionging and paying attention to him
just ignore him people
Just switch banks
I love how people simply say “just switch banks- that’ll show them”.
First, is this a realistic option for someone who has their bank account linked to automatic payments with their employer, electric company, water company, cable company, rent/ mortgage, and more? It becomes a major headache to have to update all of these accounts.
Second, how many customers does it take before a bank even notices that it’s losing business? 1 or 2 or even 10 people won’t do anything. You’d need hundreds of thousands or a million… and you try convincing a million people to go through the headache I just mentioned.
Re: Just switch banks
Employer is usually easy (unless you’re dealing with the Canadian government fuckup called Phoenix…). Ask them to send a dollar from your next pay to the new account, if it works have them send everything there. When that failed for me, they were really eager to return that lost dollar.
Never allow companies to "pull" money from your account. If they’re "push" payments, you just need to log into your old account, copy the account numbers and amounts, and add those to the new one. Wastes a half-hour but easy enough.
The confusopoly of bank account comparison is always what gets me. Monthly fees, fee waiver conditions, no-fee ATM availability, all that stuff. I’ve been looking for something other than a "huge" Canadian bank and haven’t found it so far. There are some online-only accounts, but once every year or so I actually do need to see a teller for large bills or whatever.
Modification Glitch
My family and I went through hell trying to get a modification of our mortgage during this time. It would be useful if someone would post information about how to contact Wells about this situation.
Wells Fargo is just using the computer glitch as a cover up. I lost my home to wells fargo and I was 2 and a half payments in ADVANCE The just put my payments into SUSPENSE took them out AFTER they would be LATE and then took a late fee and then claimed they are not allowed ti take PARTIAL PAYMENTS.
Oh and I worked for WF Home morgages fr a very short time until I saw all the ILLEGAL activity they used!!!!!!! Wells Fargo needs CLOSED DOWN,,,,,,,
Wells Fargo
I was living in Tucson Az. Had a nice house there for us- my husband and two children, in a very decent area, called Rita Ranch. Bank related people came to the house and said we were being evicted. I thought it was weird because I didn’t think we were doing a bad job of managing our account. From what recall, I believe we made a payment a week late, and here they were at my door evicting us. We had already paid 140,000 dollars toward owning our home. I believe the original cost was about 90,000 dollars. Basically, they wanted us out of the house so they could sell it at a higher price to make more money. Easy to do that when you are an animal and have no knowledge of ethics. Easy peasy. We did end up leaving and they still owe us the 140,000 dollars that we put into the house.Nice to know that they pretty much have unethical animals working for them. The other things I know they did was to hit us with a bunch of trumped up fees. We would make a deposit and they would delay crediting it to our account for several days, hoping that some payments we made would bounce and they could collect the fees. I completely left the bank and got an account with a credit union, that I have not had any problems with. That was in 2010. As far as the house that we moved out of, someone else eventually bought it and they do live there. Wells still owes us 140,000 that e put into it. They did send us a check for 5000 dollars, I think in 2017, and I want the rest of the money for the house that they took from us. The people who did that, who were in charge of it, are obviously not human grade material. They are animals and should be living on the street. We got some mail from them about a year ago, offering incentives for us to sign us with them. How stupid can you get. The people in charge of that place are obviously insane. I would work at a gas station or Mcdonalds or the humane society before I wold ever associate with that organization.