Access to Justice

Courageous student fights back against predatory overdraft fees
Wins huge victory -- not only for herself, but for others
harmed by Chase Bank and other banks

Megan Varvais celebrates closing her account with Wells Fargo and switching to a non-profit credit union.

Megan Varvais was a struggling young student living paycheck to paycheck when Chase Bank made the mistake of manipulating the timing of the charges on her debit card. Chase's objective: maximizing their overdraft fees and penalties, at the expense of customers living on the financial edge. Megan was far from alone in being victimized by this sleazy, predatory practice. Millions of consumers were being hit with unfair, exorbitant fees due to banks' practice of switching the timing when charges were deducted from their accounts. Suddenly, without any warning, a $3 cup of coffee cost Megan $32, thanks to Chase's added $29 overdraft fee.

When she learned Chase was trapping her in overdraft hell, and refused to allow her to opt out of "overdraft protection," so her card would be declined instead of triggering penalties, that was the moment when Megan decided to join together with other Chase victims and fight back.

What happened next is inspiring. It also helps explain why consumers' access to justice is constantly under attack by scofflaw corporations and corrupt politicians who have sold out to anti-consumer special interests.

Quote:

"That was when I learned Chase routinely held several days of customers’ transactions, then hit their accounts with everything at once — but not in the order they had made the purchases. Chase reordered the transactions from largest to smallest, because it drained accounts faster and triggered an avalanche of fees. It was not by accident, and it was so pervasive there was a lawsuit. The court documents explained how Chase not only re-engineered customers’ purchases, but purposefully withheld accurate balance information." -- Megan Varvais

Quote:

"As a direct result of our legal action, Chase agreed to stop charging overdraft fees on debit purchases less than five dollars, and it returned $110 million to customers..." -- Megan Varvais

Read more: Public Justice: Fighting Chase Bank's Overdraft Math by Megan Varvais

Full disclosure: Megan Varvais serves on the Board of Directors of the CARS Foundation, where we're enormously proud to have her on the team.

GOP Congress, Pence, and Trump side with Wall Street crooks,
Attack consumers, workers and our military heroes and their families

Bought a car? Got a cell phone? Been to the doctor? Got a job? Purchased products online? Have a credit card? You may be in for a very rude surprise. Chances are when you signed the contract, you surrendered your Constitutional right to take the business to court, no matter how many laws they break.

No matter whether they rip you off for $40 or $40,000. Even if they deliberately plot, scheme, and exploit their special access to your personal information to rip you off along with 3 or 4 million other customers -- engaging in a widespread practice of illicit conduct. That is because those contracts almost always contain "forced arbitration" clauses hidden in the fine print.

"Forced arbitration" means:

You do not get to choose whether to use arbitration or go to court.
You have to submit any dispute to a private process that is rigged against you.
Courts are open to the public. But arbitration operates in secret. The secrecy shields crooks and predators and enables the illegal behavior to keep on happening.
The company that cheated you and broke the law gets to choose the arbitrators.
Who pays the arbitrators? Usually, it's the very same company that cheated you.
The kicker: the arbitrators are perfectly free to ignore the law.
Bottom line: Forced arbitration takes away your Constitutional right to haul the wrongdoers into court, and get a fair hearing before an impartial judge or jury, where the law is applied.

The Consumer Financial Protection Bureau fights crooked banks like Wells Fargo that rip off their customers.

Crooked banks exploit forced arbitration to stop consumers they victimize from being able to fight back. This is infuriating and downright un-American.

During the Obama Administration, the Consumer Financial Protection Bureau issued a new federal rule that would have restored your Constitutional right to join forces with other consumers and fight back in court against illegal financial activity like identity theft, forgery, fake accounts, excessive overdraft fees, and other scams.

As expected, crooked banks, car dealers, and other special interests on Wall Street launched a fierce attack against the CFBP's rule. On the side of consumers, working hard to save the rule: non-profit organizations that represent consumers, unions that represent workers, faith-based organizations, and organizations that represent millions of active duty military Servicemembers and veterans and their families.

All of the Democrats in Congress voted in favor of preserving the rule and restoring your Constitutional rights. But every Republican in Congress (except GOP Senators Graham and Kennedy) and the Trump Administration sided with Wall Street and killed the rule. Former Vice President Mike Pence cast the deciding vote against it, arriving at the U.S. Senate chamber around midnight and breaking the tie, dashing consumers' hopes and pleasing scofflaw corporations. Soon afterward, in a closed-door ceremony in the White House, President Trump gleefully signed the resolution killing the rule, surrounded by lobbyists for the banks, car dealers, and other corporate special interests.

The federal agency the GOP hates the most:
the Consumer Financial Protection Bureau

Senator Elizabeth Warren (D-MA) championed the creation of the Consumer Financial Protection Bureau. The CFPB has forced crooked banks to return over $12 billion to consumers victimized by illegal practices.

"This CFPB rule will allow working families to hold big banks accountable when they're cheated and help discourage the kinds of surprise fees that consumers hate. In the upcoming months, the US Chamber of Commerce and other big business lobbying groups will go all out to get Republicans in Congress to reverse this rule, so Republicans will have to decide whether to defend the interests of their constituents or shield a handful of wealthy donors from accountability."
- Senator Elizabeth Warren

-- A few months before Republicans in Congress, former Vice President Pence, and ex-president Trump killed the CFPB's rule.

Not surprisingly, companies that commonly break the law LOVE forced arbitration. For example, Wells Fargo engaged in widespread identity theft and forgery, and made enormous profits from over 3.5 million fake accounts set up without its customers' awareness or permission. Despite all the bad press, Wells Fargo refuses to free its customers from forced arbitration. Why? Because Wells Fargo would have to return vast sums to millions of victims if they could take the bank to court. Plus its victims could get their hands on incriminating emails and possibly win a permanent injunction that would forbid Wells Fargo to engage in the same illegal conduct in the future.

According to the Los Angeles Times, "Here's why Wells Fargo forces its customers into arbitration: It wins most of the time." A report issued by Level Playing Field and funded by the CARS Foundation found that from 2009 - 2016, only 215 of Wells Fargo's customers pursued claims against the bank in arbitration. During that time, Wells Fargo created over 3.5 million fake accounts. Obviously, forced arbitration is not just another way of resolving disputes. In the real world, it usually stymies victims from getting any justice at all.

Plus, Wells Fargo is Trying to Bury Another Massive Scandal. Wells Fargo rigged the timing of when its customers were hit with overdraft fees, to maximize the penalties they had to pay the bank. This is an extremely profitable form of deception and fraud that allowed Wells Fargo to rake in huge profits at the expense of struggling moderate and low-income customers who live paycheck to paycheck.

Marine Corps vet based in Arkansas:
Forced arbitration is un-American

Opinion:

Northwest Arkansas Democrat Gazette

By Robert Mitchell, Marine Veteran
July 31, 2017

"The lenders, big banks, and huge corporate employers take away the constitutional rights of military and millions of other Americans to go to court. Corporations also tell their own customers that they can't band together against them in class actions. Instead, individuals must go to a secretive process called arbitration, run by a private arbitrator who makes the decisions and likely receives repeat business from the big corporations. It is as unfair as it seems. This is an un-American way for us--military, civilians, and big business--to civilly resolve disputes. The U.S. Constitution provides the right to access open, public courts in our state and federal systems. And we should not be denied the right to use them."

Read more: Arkansas Democrat Gazette: Marine Corps vet based in Arkansas: Forced arbitration is un-American

GOP Arbitration Hypocrisy

U.S. Senator Chuck Grassley (R-Iowa) led efforts in Congress so that car dealers can sue, but denies consumers the same rights.

What did Republicans say about arbitration before, when they were granting car dealers a special exemption from forced arbitration?

Republican Senator Chuck Grassley, Chairman of the Senate Committee on the Judiciary, presented a bill in Congress to restore car dealers' freedoms, so they could sue giant auto manufacturers in court. Then, he said:

"When mandatory binding arbitration is forced upon a party, for example when it is placed in a boiler-plate agreement, it deprives the weaker party the opportunity to elect another forum. As a proponent of arbitration I believe it is critical to ensure that the selection of arbitration is voluntary and fair. The purpose of arbitration is to reduce costly, time-consuming litigation, not to force a party to an adhesion contract to waive access to judicial or administrative forums for the pursuit of rights under State law."

"This legislation will go a long way toward ensuring that parties [car dealers] will not be forced into binding arbitration and thereby lose important statutory rights. I am confident that given its many advantages arbitration will often be elected. But it is essential for public policy reasons and basic fairness that both parties to this type of contract have the freedom to make their own decisions [whether to sue or not] based on the circumstances of the case." -- Senator Chuck Grassley, (R-Iowa)

Source: Statements on Introduced Bills and Joint Resolutions,
United States Senate, June 29, 2001.

What happens in arbitration?

Here's what happened to one consumer, Jon Perz, who was forced to surrender his rights when he bought a used car from a car dealership in San Diego, CA. Businesses often claim arbitration is quicker than going to court. But because of forced arbitration, he had to wait over 8 years to get justice. Meanwhile he couldn't drive his car because it was too unsafe.

Many more people have had nightmarish experiences because of forced arbitration.

A Soldier returns from duty, and finds his job is gone.

Javier served our nation proudly. Then his employer refused to re-hire him - violating the law.

This is illegal. But forced arbitration keeps our military heroes from getting justice, or their jobs back.

"It's hard to imagine a group of Americans more deserving of our protection than the servicemen and women who protect our country. Javier, an Army Reservist from Florida, is one of them. But Javier – like too many others – was a victim of something called forced arbitration, and the fact that he served our country apparently made little difference to those who employed him."

NEWS: For immediate release: Wednesday, June 28, 2017

Contacts:
               Jeff Barbosa, Office of CA Senator Bob Wieckowski, 916-651-4010
               Rosemary Shahan, Consumers for Auto Reliability and Safety Foundation, 530-759-9440
               Prof. Steven Bonorris, U.C. Hastings College of Law, 415-260-3980
               Michael Waldron, U.C. Hastings College of Law, 978-490-0405

Scofflaw Arbitration Firms Fail to Comply with California's Disclosure Law "Kangaroo Courts" Operate in Secret

A major new report released today found that private arbitration firms that hear cases brought by consumers, workers, victims of nursing home abuse, homeowners, victims of sexual harassment, and others against corporations that engage in fraud, sexual harassment, wage theft, abuse of nursing home residents, and other illegal activity are themselves scofflaws. They all fail to fully comply with California's law that requires them to disclose basic information about the cases and their outcomes.

The report was written by the Public Law Research Institute (PLRI) UC Hastings College of Law, which pored over records, analyzed data, and contacted arbitration firms directly as part of its investigation into whether compliance had improved since the PLRI issued its earlier report in 2013.

Key findings:

No firm discloses all of the required information for all of its cases
Out of 32 firms that apparently offer arbitration services in California, only 3 provide information that is readily accessible on the home page of their website, and is searchable and sortable, as required by law
9 arbitration firms do not provide any data at all, and claim they are not required to comply with the law. However, at least one of those firms' websites promotes its arbitration services as an alternative to small claims court
The American Arbitration Association, which has closed 1021 cases in California since 2014, fails to provide required information about the prevailing party in most cases where there was a hearing and an award (reporting the prevailing party in only 46% of such cases)
The Kaiser Office of the Independent Administrator reports 98 arbitrated cases since 2014; of those, the non-Kaiser party prevailed only 6% of the time
Despite the greater efficiency touted by proponents of arbitration, the report notes the interval between filing and disposition of cases ranging from 150 days to more than 350 days for the major arbitration firms

"The Public Law Research Institute's report shows that even years after AB 802 became law, widespread noncompliance and a stunning lack of transparency remain the standard operating procedure for California's private arbitration firms," said Senator Bob Wieckowski (D-Fremont), the author of 2014's AB 802. "The persistent failure to disclose required information only serves to reaffirm doubts that consumers don't get a fair

shake in such a secret, privatized system. The industry touts its fairness and efficiency, but by refusing to disclose critical information, it is little wonder why consumers think the deck is stacked against them."

       "The ripoff clause hidden in consumer and worker contracts denies American citizens their Constitutional right to hold crooked corporations accountable in an open, public court of law," said Rosemary Shahan, President of the Consumers for Auto Reliability and Safety Foundation, the non-profit consumer organization that commissioned the report.

       "It's bad enough how corporations take away consumers' rights through these kangaroo courts; this report shows how they add insult to injury by keeping the results of the cases a secret," said Joe Ridout, spokesman for Consumer Action.

       The CFPB has proposed rules to protect the public from corporate crooks like Wells Fargo, that exploit arbitration to hide their widespread illegal activity. The proposed rules would require arbitration firms to provide basic data about their operations. If the rules are promulgated and the firms fail to comply, they could face sanctions by the CFPB.

       "Corporate crooks like Wells Fargo hide behind arbitration to get away with cheating their customers and employees," said Richard Holober, Executive Director of the Consumer Federation of California. "We need effective enforcement of California's arbitration disclosure law, plus we need to keep a strong, independent Consumer Financial Protection Bureau to crack down on illegal activity."

       Proponents of arbitration claim that it is quick and convenient. But it is often used to evade, deny, or delay justice. Some corporations force victims into arbitration, then fail to pay the filing fees for the process, leaving their victims stuck in "arbitration purgatory."

       "Because of all the delays in arbitration, it took over 7 years for me to get justice," said Jon Perz of San Diego. In 2007, Mossy Toyota in Pacific Beach, CA sold him an unsafe used car. When Perz sued, the dealer forced the case into arbitration, then refused to pay the fee required to initiate the arbitration process. After years of delays, the American Arbitration Association dumped the dealer, due to non-payment. Then Perz had to wait to get a hearing before a different arbitration firm. In 2014, JAMS arbitrators found that the car was unsafe, and awarded him double the purchase price plus interest and his attorneys fees. Meanwhile, he had been unable to drive his car, after paying $12,000 for it.

       Susan J. Fowler, who shed the spotlight on sexual harassment at Uber, writes that "ending forced arbitration...is the single most important thing a company can do to prove to its employees that it is dedicated to acting ethically, legally, responsibly, and transparently."¹

Documents / video:

The full report is posted at: Arbitration Reporting in California: Compliance with CCP [Code of Civil Procedure] § 1281.96.

A video about Jon Perz' used car nightmare has received over 1.3 million views on YouTube.

###

1 "Five Things Tech Companies Can Do Better" - Susan J. Fowler, May 20, 2017. Posted at: https://www.susanjfowler.com/blog/2017/5/20/fivethings-tech-companies-can-do-better

NEWS for immediate release: Monday, February 27, 2017

Contact: Rosemary Shahan, CARS Foundation, 530-759-9440
Joe Ridout, Consumer Action, 415-777-9648 ext. 705
Carol McKay, National Consumers League, 412-945-3242, carolm@nclnet.org

Consumer / Activist Groups and Wells Fargo Victims Target Wells Fargo
over Forced Arbitration,
Release Letter to Wells Fargo CEO Sloan, Calling on Wells Fargo
To Stop Forcing Customers and Workers to Surrender Constitutional Rights

       In news events across the nation, in Washington, DC, and at Wells Fargo's headquarters in San Francisco, consumer and activist organizations closed their accounts with Wells Fargo, to protest the bank's refusal to stop imposing a "rip-off clause" forcing its customers and workers to surrender their constitutional rights, to obtain services or employment.

       The organizations also released a letter from a broad-based coalition of groups calling on Wells Fargo's CEO Sloan to cease forcing its customers and workers to submit to forced arbitration. The bank continues to resist calls from pro-consumer leaders such as Senators Sherrod Brown (D-OH), Elizabeth Warren (D-MA), and Representative Maxine Waters (D-CA), and the editors of leading newspapers for the bank to free its customers and employees to pursue cases before a court of law, particularly regarding millions of accounts set up without their permission, through identity theft, forgery, and fraud.

       "After six years of banking with Wells Fargo, we're switching to another bank that respects the the constitutional rights of its customers and workers," said Sally Greenberg, Executive Director of the National Consumers League, based in Washington, DC. The League already established a new account at Bank of Labor, which does not impose forced arbitration, and is closing its account at Wells Fargo, withdrawing its working capital, of approximately $1.8 million.

       The GOP-controlled Congress and the Trump administration are threatening to fire Richard Cordray, the Director of the Consumer Financial Protection Bureau, who has a long record of protecting consumers. Under his leadership, the CFPB has succeeded in forcing banks to refund over $11.8 billion to consumers who were wronged.

       "They want to replace Richard Cordray with someone who will let crooked banks like Wells Fargo get away with charging consumers billions of dollars through engaging in illegal practices. So it's up to each of us to act, to protect ourselves and also send the message we won't tolerate crooked bankers," said Rosemary Shahan, President of the Consumers for Auto Reliability and Safety (CARS) Foundation. The group unveiled a new website, at "We DO Count.org" focusing on the campaign to make the switch from Wells Fargo to more consumer-friendly banks or credit unions.

       "Wells Fargo opened up a credit card account without my authorization, and it ended up harming my credit and making many purchases, like a car, and even utilities a lot more expensive, for about five years," said Aaron Brodie, who was a freshman college student when Wells Fargo opened a credit card account without his permission, then refused to close it, after he requested that it be closed. He has sued Wells Fargo, and instead of doing what is right, Wells Fargo is seeking to force his case into arbitration.

       "As long as Wells Fargo requires mandatory arbitration, there is nothing to stop Wells Fargo from violating the privacy rights of its customers and engaging in fraud," said Byron Cooper, who closed his accounts with Wells Fargo as soon as he discovered the bank had opened two new accounts and shifted $25,000 from his checking account to his savings account -- all without his authorization, and despite his insistence he did not want the new accounts. The bank also changed his "free" checking account to one that charged $30 per month and required a minimum balance of $25,000 -- also without his permission.

       Joe Ridout, Consumer Services Manager for Consumer Action, personally hand-delivered the letter to the bank's headquarters in San Francisco. Consumer Action also provided tips for consumers about how to find a banking institution or credit union that does not impose forced arbitration on its customers and workers, and also how to make the transition smoothly so that no payments are missed. "We believe many consumers will be pleasantly surprised to discover the higher interest they earn, and the fewer fees and abusive practices they face, once they switch to a more honest financial institution," said Ridout.

       Most credit unions don't require arbitration. In 2015, the Pew Charitable Trust released a report that provides comparisons of banks, including whether they impose forced arbitration. While some of the policies may have changed, that report provides helpful guidance for choosing options that don't impose arbitration.

Links to relevant documents:

Coalition Letter to Wells Fargo CEO Timothy Sloan

"Wells Fargo Victims Deserve Their Day In Court," Sacramento Bee Editorial, December 8, 2016

"Wells Fargo Blocks the Courthouse Door," Des Moines Register Editorial, December 4, 2016

Consumer Action's Tips for Consumers: How to Make the Switch from Wells Fargo

"Checks and Balances" by Pew Charitable Trust, May 2015

###

Speakers -- Press Conference Call February 27, 2017

(Includes summary about two speakers' personal experiences with Wells Fargo)

Letter to Wells Fargo CEO Timothy Sloan, hand-delivered to Wells Fargo Headquarters In San Francisco by Joe Ridout of Consumer Action
on Friday, February 24, 2017:

Alliance of Californians for Community Empowerment
Consumer Action
Consumer Federation of California
Consumers for Auto Reliability and Safety (CARS) Foundation
Courage Campaign
ForgoWells
Homeowners Against Deficient Dwellings
Housing and Economic Rights Advocates
Level Playing Field
Make the Road New York
Montana Organizing Project
National Association of Consumer Advocates
National Consumers League
National Consumer Law Center (on behalf of its low-income clients)
Public Citizen
Public Good
Public Justice
Progressive Congress Action Fund
Tennessee Citizen Action
TURN – The Utility Reform Network
Workplace Fairness

February 24, 2017

Mr. Timothy Sloan, Chief Executive Officer
Wells Fargo
420 Montgomery Street
San Francisco, CA 94104

Dear Mr. Sloan:

On behalf of the above-listed organizations, we write to request that Wells Fargo immediately cease its use of forced arbitration "ripoff clauses" to deny customers and workers their constitutional right to obtain justice before a court of law.

After repeatedly engaging in illegal activities involving millions of its customers, the bank has an obvious interest in repairing its damaged reputation. The public would reasonably expect that Wells Fargo would be eager to take the obvious step of allowing its customers to obtain redress for those violations as easily and efficiently as possible. Instead, it appears that the bank remains entrenched in its view that forced arbitration is so important to the bank's operations that even in the midst of scandal it refuses to restore to consumers and employees a basic constitutional right. This reasoning seems to us deeply miscalculated. It disserves your customers, it continues to harm your reputation, and it compels

us to continue to call on people across this nation who value their constitutional rights to close their accounts with Wells Fargo, and on institutions that respect those rights to divest from the bank.

The illegal activities in which Wells Fargo has engaged are not limited to the fraud scandal that captured headlines several months ago. Rather, the bank's violations of the law constitute a pattern of disregard for basic consumer protections. Among those activities are the following:

Creating roughly 2 million bogus accounts through fraud, identity theft, and / or forgery, causing many victims to suffer significant losses and negative financial consequences, sticking them with nearly $2.5 million in fraudulent fees, and often also harming their credit.
Illegally repossessing at least 413 vehicles from members of the United States Armed Forces and their families, from 2006 through 2015, while those servicemembers were serving on active duty in defense of our nation – without obtaining a court order, in violation of the Servicemembers Civil Relief Act. This practice was particularly reprehensible, because servicemembers often are assigned to duty in war zones where their expertise is invaluable for our national security. Repossessions can result in a loss of security clearances, costing our nation desperately needed services by highly trained military personnel.
Illegally foreclosing on homes purchased by 239 members of the United States Armed Forces and their families, while those servicemembers were serving on active duty – again without obtaining a court order, in violation of the Servicemembers Civil Relief Act. This practice is also particularly troubling given its negative impact on our national security, particularly when such practices cause a loss not only of homes, but of security clearances and future job prospects. Wells Fargo was compelled by the U.S. Department of Justice to pay over $28.3 million in relief to the servicemembers and their co-borrowers.
Engaging in unfair and deceptive practices to maximize the penalties and fees paid by customers to Wells Fargo, by manipulating the chronology of when debits and checks were assessed, costing customers in California alone approximately $203 million in excessive penalties and fees. After a judge awarded refunds to victims of the bank's illegal practices, Wells Fargo continued to litigate and tried to force victims' claims into arbitration, taking their case all the way to the United States Supreme Court. The bank delayed justice for Wells Fargo customers for over ten years, until all avenues for litigation ended and their victims finally won, obtaining $203 million in refunds.

There is a common thread in these cases, and it is a disregard for customers' rights when there is a potential impact on the bank's bottom line. Consumers have no reason to believe that Wells Fargo is doing anything differently, when the bank still persists in depriving its customers and workers of their basic constitutional rights. A change in culture does not mean doing the right thing only when it does not cost anything. It means doing the right thing, period. How can Wells Fargo claim to be doing the right thing when it continues to force customers it has wronged into giving up their constitutional rights – even in cases where the account in dispute was created through fraud, identity theft, and /or forgery?

As the Des Moines Register recently editorialized, after you met with the editors:

       "When Wells Fargo's news CEO, Timothy Sloan, met with the Des Moines Register's Editorial Board a few weeks ago, he said the bank intends to do everything it can to win back the trust of its customers…

       "Unfortunately, Sloan made clear in his discussion with the Register that one thing the bank won't consider in its efforts to "make it right" is waiving the contractual requirement that forces customers to take any and all grievances to private arbitration rather than to court. In fact, Wells Fargo recently took the formal step of asking a federal court to disallow the claims of dozens of customers who are attempting to have their case heard by a judge in a court of law.

       "The problem is that arbitration denies customers the legal protections normally afforded through court proceedings, such as the right to appeal. And because arbitration hearings and the evidence they produce are not open to the public, arbitration also helps to conceal widespread, corporate-level misconduct from other potential litigants, as well as from other customers and regulators.

       ...if Wells Fargo is sincere about atoning for its actions and doing the right thing for its customers, it will reverse course and voluntarily waive the arbitration requirement, allowing the people who were victimized by its practices to have their complaints heard in open court."¹

       And, as the Sacramento Bee editorialized:

"As if the rip-off of some 2 million customers weren't enough for Wells Fargo & Co., it turns out that the bank is trying to deprive its victims of their days in court….Wells Fargo has been arguing in federal and state courts that the wronged customers should have to argue their cases, not in public, but in private arbitration.

       "It's a cynical ploy, and destructive to the public trust and the legal system. Forced private arbitration...often tilts contractual arrangements in favor of corporate interests and deprives the public of important consumer information and case law.

       "Companies like it because it keeps bad publicity out of the public record, stymies potential class actions and improves the odds of favorable decisions; private paid judges know that companies often give repeat business to arbitrators who give favorable rulings. Consumers are at a disadvantage in what has come to amount to a shadow system of civil justice….

       "In the Wells Fargo case, the push is particularly reprehensible...the bank claims that those [arbitration] waivers apply to the legitimate accounts, and to the fake ones, even though the signatures were forged in many cases. It's a scam on top of a scam..."²

       We are plainly not alone in our concern about Wells Fargo's continuing practice of forcing its employees and customers to surrender their constitutional rights as a condition of employment or

1 Editorial: "Wells Fargo blocks the courthouse door," Editorial, Des Moines Register, December 4, 2016. Posted at:
http://www.desmoinesregister.com/story/opinion/editorials/2016/12/04/editorial-wells-fargo-blocks-courthousedoor/94811490/

2 Editorial: "Wells Fargo victims deserve day in court," Sacramento Bee, December 9, 2016. Posted at:
http://www.sacbee.com/opinion/editorials/article119768343.html

services. Forced arbitration is not a sign of respect for an employee or customer; it is the opposite. It also allows Wells Fargo to perpetuate a cover-up of its illegal practices.

       As the current Chairman of the United States Senate Judiciary Committee, Senator Charles Grassley (R-Iowa), stated in presenting legislation in Congress to restore protections from forced arbitration for auto dealers, granting them a special exemption from the Federal Arbitration Act:

       "When mandatory binding arbitration is forced upon a party, for example when it is placed in a boiler-plate agreement, it deprives the weaker party the opportunity to elect another forum. As a proponent of arbitration I believe it is critical to ensure that the selection of arbitration is voluntary and fair. The purpose of arbitration is to reduce costly, time-consuming litigation, not to force a party to an adhesion contract to waive access to judicial or administrative forums for the pursuit of rights under State law.

       "This legislation will go a long way toward ensuring that parties will not be forced into binding arbitration and thereby lose important statutory rights. I am confident that given its many advantages arbitration will often be elected. But it is essential for public policy reasons and basic fairness that both parties to this type of contract have the freedom to make their own decisions based on the circumstances of the case."³

       Clearly the same principles apply to individual consumers and workers, who have vastly unequal bargaining power when entering into contracts with lending institutions as large as Wells Fargo.

       We call on Wells Fargo to do the right thing, and to immediately cease using forced arbitration clauses in its consumer and employment contracts. A number of competing banks and credit unions already have decided to respect their customers and workers, and not to deny them their constitutional rights. Until Wells Fargo ends its practice of depriving its customers and workers of their constitutional rights as a condition of obtaining products, services, or employment, we will continue to call upon all Americans who value those rights to close their accounts with the bank, and all institutions to divest from Wells Fargo.

       In order to reply to this letter, please contact: Rosemary Shahan, President of the Consumers for Auto Reliability and Safety (CARS) Foundation. We look forward to your prompt action to restore precious, fundamental constitutional rights to your customers and employees.

       Sincerely,

3 Statements on Introduced Bills and Joint Resolutions, United States Senate, June 29, 2001. Statement by Senator Grassley of Iowa.

Make the Road New York
Montana Organizing Project
National Association of Consumer Advocates
National Consumers League
National Consumer Law Center (on behalf of its low-income clients)
Public Citizen
Public Good
Public Justice
Progressive Congress Action Fund
Tennessee Citizen Action
TURN – The Utility Reform Network
Workplace Fairness