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This is more than just a dispute. This is criminal activity and fraud. Consumer Financial Services Agreements: As of May 5th, the Consumer Financial Protection

This is more than just a dispute. This is criminal activity and fraud. Consumer Financial Services Agreements: As of May 5th, the Consumer Financial Protection Bureau has proposed a rule that would prohibit mandatory arbitration clauses in financial services agreements that limit access to class action lawsuits. Once formalized, this rule would apply to all contracts, including those already signed. Although such a rule would not necessarily prohibit mandatory arbitration for single-plaintiff claims, arbitration clauses that do not specifically exclude class action lawsuits from their reach may be invalid regardless.[1] Consumer Contracts: Although generally upheld, mandatory arbitration clauses in consumer contracts are non-binding when there is evidence of fraud. The Theranos lawsuits have recently brought this reality back to the attention of corporate lawyers. Because Theranos and Walgreens face accusations of widespread fraud, otherwise enforceable arbitration clauses are thrown out, allowing for class-action claims regardless. It’s important to note that these cases demonstrate that the fraud must merely be investigated, not conclusively proven, for the courts to now invalidate arbitration clauses.[1] I think it's safe to say that fraud in this case has been conclusively proven. [1]: https://www.priorilegal.com/blog/the-limits-of-mandatory-arbitration-clauses https://www.priorilegal.com/blog/the-limits-of-mandatory-arb...

slededit 10y ago
Criminal charges proceed separately from the civil case which this article is talking about.
- eruditely 10y ago
  It's not okay to do what they, Wells Fargo, have done(deceive) period. Full accounting of moral behavior includes an absolute prohibition on selling with an intend to deceive via an asymmetry of information, since risk can be epistemic/subjective related to ignorance of outcomes that the counterparty already knows about, then they sold you a product/service/contract with an intend to offload risk on you, which is strictly immoral period. Absolute prohibition on parasitism via exchanges made via an asymmetry of information and they cannot prevent restitution because you agreed to not sue for something else. What a bunch of nonsense.
  - slededit 10y ago
    I am not making a value judgement on what they did - nor am I excusing it. This is a legal argument about venue - where and how the case should be heard. Getting angry at Well's Fargo might feel good, but in the end its pointless. Understanding the law itself does have practical use going forward. Perhaps the scope of signing away your right to a class action will be better understood.
    - FullMtlAlcoholc 10y ago
      > Perhaps the scope of signing away your right to a class action will be better understood. reply This is not really a choice if you want to use a mobile phone or any tele-communications service. Same goes for employment contracts.
    - mcherm 10y ago
      > Perhaps the scope of signing away your right to a class action will be better understood. I don't think there is a lack of understanding, I think (although I have no evidence for this) that MOST consumers, if asked what that clause meant, would say something like "Oh, that's the weasel words that let the company get around legal rules." Which is essentially true. The problem is lack of power, not lack of understanding. There is no way to avoid these arbitration clauses. The companys' interests are such that they will include them and make no exceptions; consumers cannot even refuse and find a competitor because ALL competitors in the market will insist on it. So long as we offer a "don't have to be subject to the law" clause, everyone will use it.
Lazare 10y ago
> Judges in California and federal courts have ruled arbitration clauses signed by customers when they opened legitimate accounts prevent them from suing even over allegedly fraudulent accounts created without their knowledge. http://www.latimes.com/business/la-fi-wells-fargo-arbitration-20151205-story.html http://www.latimes.com/business/la-fi-wells-fargo-arbitratio...
- FullMtlAlcoholc 10y ago
  Interesting. So, signing a contract with no intent to comply, fraudulently signing a contract would disallow arbitration, but committing fraud after the fact is ok?

slededit 10y ago

Criminal charges proceed separately from the civil case which this article is talking about.

eruditely 10y ago
It's not okay to do what they, Wells Fargo, have done(deceive) period. Full accounting of moral behavior includes an absolute prohibition on selling with an intend to deceive via an asymmetry of information, since risk can be epistemic/subjective related to ignorance of outcomes that the counterparty already knows about, then they sold you a product/service/contract with an intend to offload risk on you, which is strictly immoral period. Absolute prohibition on parasitism via exchanges made via an asymmetry of information and they cannot prevent restitution because you agreed to not sue for something else. What a bunch of nonsense.
- slededit 10y ago
  I am not making a value judgement on what they did - nor am I excusing it. This is a legal argument about venue - where and how the case should be heard. Getting angry at Well's Fargo might feel good, but in the end its pointless. Understanding the law itself does have practical use going forward. Perhaps the scope of signing away your right to a class action will be better understood.
  - FullMtlAlcoholc 10y ago
    > Perhaps the scope of signing away your right to a class action will be better understood. reply This is not really a choice if you want to use a mobile phone or any tele-communications service. Same goes for employment contracts.
  - mcherm 10y ago
    > Perhaps the scope of signing away your right to a class action will be better understood. I don't think there is a lack of understanding, I think (although I have no evidence for this) that MOST consumers, if asked what that clause meant, would say something like "Oh, that's the weasel words that let the company get around legal rules." Which is essentially true. The problem is lack of power, not lack of understanding. There is no way to avoid these arbitration clauses. The companys' interests are such that they will include them and make no exceptions; consumers cannot even refuse and find a competitor because ALL competitors in the market will insist on it. So long as we offer a "don't have to be subject to the law" clause, everyone will use it.

Lazare 10y ago

> Judges in California and federal courts have ruled arbitration clauses signed by customers when they opened legitimate accounts prevent them from suing even over allegedly fraudulent accounts created without their knowledge. http://www.latimes.com/business/la-fi-wells-fargo-arbitration-20151205-story.html http://www.latimes.com/business/la-fi-wells-fargo-arbitratio...

FullMtlAlcoholc 10y ago
Interesting. So, signing a contract with no intent to comply, fraudulently signing a contract would disallow arbitration, but committing fraud after the fact is ok?