Wells Fargo Faces Controversy Over Frozen Accounts

Wells Fargo asserts that it did nothing wrong when it froze $204,000 in a customer’s account, despite partially settling with attorneys who claim otherwise.

A North Carolina client named Ethan Parker filed a lawsuit against the banking giant, alleging that he was denied access to his funds with “little to no explanation.”

Triangle Business Journal reports that despite contesting Parker’s claims, Wells Fargo will soon issue a check for $204,000 to Parker.

Jim White, the attorney for Parker, states that his team is now seeking additional damages and attorney fees.

“You cannot disrupt someone’s financial life for a year without facing consequences. I believe it’s fair to say that we feel vindicated because Wells Fargo was allowed to contest anything we said in court. They were permitted to present evidence. They decided against doing so, so we feel vindicated.”

Parker claims he has been unable to pay his mortgage since losing access to the money given to him by his adoptive mother upon her passing.

Wells Fargo agreed in December to pay $2 billion to current and former customers and a $1.7 billion civil penalty to the Consumer Financial Protection Bureau (CFPB) for illegally freezing consumer accounts and charging fees and interest on auto and mortgage loans.

In addition, the bank agreed last month to pay the U.S. Securities and Exchange Commission a $35 million civil penalty for allegedly charging excessive fees for investment advice.

In both instances, the company settled allegations without admitting or denying guilt.

Wells Fargo reported a net income of $13.18 billion in 2022, down from $21.54 billion in 2021.