A class action has been filed against Wells Fargo alleging that its Merchant Services misleads customers and charged excessive fees for its credit- and debit-card-processing services.
The complaint alleges that Wells Fargo Merchant Services inflates “pass through” costs, increases agreed-upon fees, and imposes new charges without telling new customers about these costs when they sign up. The complaint also alleges that an improper $500 termination fee is charged if a merchant wants to end the services.
Claims include breach of contract and breach of the covenant of good faith and fair dealing. The plaintiffs seek restitution of any improper fees, disgorgement and other damages.
The new complaint is the latest in a series of actions against Wells Fargo since September 2016, when it agreed to pay $185 million to settle a claim by the CFPB over the creation of more than 2 million deposit and credit card accounts without their customer’s knowledge or approval. Wells Fargo later agreed to a class action settlement with customers who alleged they suffered financial losses from unauthorized accounts. That case was settled for $142 million.
In late July 2017, Wells Fargo said it would reimburse $80 million to approximately 570,000 customers who were wrongly charged for auto insurance.
The case is Patti’s Pitas LLC et al. v. Wells Fargo Merchant Services LLC, case number 1:17-cv-04583 in the U.S. District Court for the Eastern District of New York.