L.A. sues Wells Fargo over sales practices

The city of Los Angeles filed a civil lawsuit Tuesday against Wells Fargo, alleging that the bank has been looking the other way as its sales people take advantage of customers, including Mexican immigrants, by opening accounts and issuing credit cards without their permission.

Wells Fargo's push to get every customer to carry at least eight different Wells Fargo products has "predictably and naturally, driven its bankers to engage in fraudulent behavior," Los Angeles City Attorney Mike Feuer said Tuesday.

Alleged abuses include lying about fees, opening customer accounts and issuing credit cards without customers' authorization, the lawsuit says. Customers with Mexican ID cards are often targeted because their lack of a Social Security number "makes it easier to open numerous fraudulent accounts," according to the lawsuit.

"Wells Fargo has known about and encouraged these practices for years," Feuer alleged in the complaint.

Wells Fargo will "vigorously defend" against the allegations, the $287 billion company said in a statement.

"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 & Values and our commitment to customers receiving only the products and services they need and will benefit from," the statement said.

Wells Fargo has been pushing for the average customer to hold eight different accounts as part of its "going for gr-eight" initiative. This has resulted in pressure on bankers to victimize consumers or face repercussions, including termination, for failing to meet sales quotas, the Los Angeles city attorney said.

The lawsuit says Wells Fargo management has also failed to protect customers from the financial harm when they discovered abuses by their sales force.

"On the rare occasions when Wells Fargo did take action against its employees for unethical sales conduct, Wells Fargo further victimized its customers by failing to inform them of the breaches, refund fees they were owed, or otherwise remedy the injuries that Wells Fargo and its bankers have caused," the lawsuit says.

The lawsuit claims customers were hurt by having money withdrawn from their authorized accounts in order to pay for fees tied to unauthorized accounts. Wells Fargo also placed customers into collection when unauthorized accounts went unpaid.

Wells Fargo is the nation's third largest bank by assets and the largest bank in California, where the lawsuit was filed.