South Carolinians could be protected from Wells Fargo
By ROBERT MEYEROWITZ
Wells Fargo, the world’s second-largest bank, is facing scrutiny for its unsavory practices yet again, now by the Federal Reserve Bank of San Francisco — and this time it could affect South Carolinians who’ve had auto loans through the bank.
Not so long ago Wells Fargo was the world’s largest bank — until it fell to second place by market capitalization behind JP Morgan Chase last year, once it became widely known that it had been involved in the creation of over 2 million fake bank accounts by thousands of Wells Fargo employees.
Several successive scandals have followed, which the bank has described as errors and oversights, although all have seemed to benefit the bank at the expense of its customers.
Now, according to The New York Times, the bank failed to refund guaranteed auto protection, or GAP, insurance money to people who paid off car loans early.
“It is not mandatory for car buyers to carry GAP insurance, which typically costs $400 to $600,” The Times reports. “But car dealers push the insurance, and lenders like it because of the protection it provides. When borrowers pay off the loans early, they are entitled to a refund of some of the GAP insurance premium because the coverage they paid for is no longer needed.”
Laws in nine states say unused insurance money must be refunded. South Carolina is one of them.
The latest scandal comes on the heels of revelations that Wells Fargo forced unneeded collision insurance on 800,000 of its auto loan customers.