Wells Fargo Bank Sues Itself

Extreme economic problems require extreme solutions, and Wells Fargo Bank has come up with a good one. They have decided to sue themselves. Wells Fargo holds the first and second mortgages on a condominium that is going into foreclosure. As holder of the first, they are suing all other lien holders, including the holder of the second, which is Wells Fargo. It gets better. The company has hired a lawyer to defend itself against its own lawsuit. The defense lawyer even filed this answer to the complaint, "Defendant admits that it is the owner and holder of a mortgage encumbering the subject real property. All other allegations of the complaint are denied." On the website The Consumer Warning Network, Angie Moreschi wrote: "We've apparently reached the perfect storm for complete and utter idiocy by some banks trying to foreclose on homes."

Comments

Oh, dear Atheismo

[Anonymous Coward]

It's not satire... I weep for humanity

Re:Oh, dear Atheismo

[tritonman]

This is right up there with that politician who wanted to sue God.

Re:Oh, dear Atheismo

[AndersOSU]

no, that was actually funny and made a political statement.

This is just sad.

Re:Oh, dear Atheismo

[Zey]

This is right up there with that politician who wanted to sue God.

Well, given The Pope claims to be His representative and The Vatican hoards gagillions of dollars in assets (aside: while begging for donations), God's a very ripe target with plenty of ability to pay.

Re:Oh, dear Atheismo

[osu-neko]

Well, given The Pope claims to be His representative and The Vatican hoards gagillions of dollars in assets (aside: while begging for donations), God's a very ripe target with plenty of ability to pay.

Hmm. If the Vatican can be held financially liable for acts of God...

The downside of this idea is that the primary beneficiary of it would be hordes of lawyers. I'm agnostic but I'd rather give the money to Catholic Charities.

Re:Oh, dear Atheismo

[AHuxley]

You may enjoy The Chaser - New Seven Deadly Sins.
"excessive wealth" sits in well with 'Bank Sues Itself" :) http://www.youtube.com/watch?v=LkJqrNhIetk

You can Do that?

[Monkeedude1212]

I'll See Me In court!!!

Re:You can Do that?

[K. S. Kyosuke]

I heard they have lavatories with mirrors. Help yourself.

Re:You can Do that?

[tmosley]

And when I can't pay up, I'll just ask the government for another bailout to pay the attorney fees and damages!

When a bailed out bank sues itself, we lose.

Re:You can Do that?

[Excelsior]

Recently, I called Wells Fargo and told them to "Go f*** yourselves"; I didn't anticipate they would take me so literally.

Re:You can Do that?

[Majik Sheff]

Wells Fargo has made so much money charging their customers fees (I think there might be a fee for fee processing) that they not only didn't need to take bailout money, they can afford to build a nice shiny corporate office with heated sidewalks. HEATED SIDEWALKS.

When I found out that my bank was being bought by Wells Feego I changed banks. When I went in to close the account, they asked why. When I told the teller it was because of the impending transfer she told me she was planning on quitting on the day of the changeover.

A good friend of mine worked in their credit card department for a very short while, he had to quit because he wasn't getting any sleep.

I hope W.F. sues itself into oblivion. This is one time I'll actually cheer for them to win a lawsuit. Let's go for quadruple damages while we're at it and see to it that the lawyers get an 80% fee on the proceeds.

Re:You can Do that?

[uberjack]

Then how will you pay your bonuses?

Re:You can Do that?

[Het Irv]

Maybe you just discovered your superpower, the power to implant subtle messages in corporate bureaucracy. Who are you gonna call next?

Re:You can Do that?

[Dragonslicer]

they can afford to build a nice shiny corporate office with heated sidewalks.

Where's the office? If it's in the northeast or northern mid-west, heated sidewalks are a great idea, since they'd be much more reliable, be safer, and require less human work than having the grounds staff out there with salt, sand, and ice chippers (whether or not they're better environmentally than salt and sand would depend primarily on where the building gets its electricity from). My parents' house has a heater under the front stairs and porch to keep it free of ice in the winter, and I wish the university I went to could move around some of the underground steam pipes to help clear more of the sidewalks; it was funny seeing patches of bare sidewalk in the middle of the winter where the pipes went under them.

As for suing themselves and even hiring a lawyer to defend the lawsuit, well holy shit, that's hilarious.

Re:You can Do that?

[goaliemn]

Heated sidewalks are not that outrageous in the midwest. Its cheaper to heat them and keep them ice free vs the possible liability of someone slipping and falling. Lots of older sidewalks in downtown st paul are heated. They put the steam pipes close enough to the surface that the steam basically heats em.

Re:You can Do that?

[Anonymous Coward]

best post I've read in a while!

Re:You can Do that?

[dkleinsc]

Obviously, his next call with that particular message ought to be to Dick Cheney.

Re:You can Do that?

[Anonymous Coward]

heated sidewalks are a great idea, since they'd be much more reliable, be safer, and require less human work than having the grounds staff out there with salt, sand, and ice chippers

That's a horrible idea! You can't go technologizing sidewalk salters out of their jobs In These Tough Economic Times!

Re:You can Do that?

[Mister Whirly]

Not as outrageous as Wells Fargo wanting the Minnesota Department of Transportation to build an exit ramp off Interstate 35W because their corporate offices are a whole 4 blocks away from the currently existing exit.

Re:You can Do that?

[AndersOSU]

great idea asshole.

The last thing we need is Dick Cheney firing bunker busting nuclear weapons at his undisclosed location in suburban Washington... ...on second thought... just give us non bureaucrats a warning first, will ya?

Re:You can Do that?

[Anonymous Coward]

This is why the only "industry" in the U.S. is law suits. So the Lawyers have found yet another ridiculous way to make money.

Re:You can Do that?

[contrapunctus]

If it's geothermal heating for the sidewalk, it's a great idea. Save on shoveling and salt. And it uses minimal energy.

Re:You can Do that?

[R3d M3rcury]

Well, their corporate offices are in San Francisco. That said, a quick look at google gives us various applications for Wells Fargo to have heated sidewalks in their Des Moines, Iowa office, where they have an average of 32 inches of snowfall during the winter.

I'm sure electrically heated sidewalks are cheaper than paying some guy to shovel the snow.

Re:You can Do that?

[R3d M3rcury]

While I'm not necessarily a fan of Wells Fargo, I gotta admit I'm finding this curious:

Wells Fargo has made so much money charging their customers fees (I think there might be a fee for fee processing) that they not only didn't need to take bailout money, they can afford to build a nice shiny corporate office with heated sidewalks.

Okay, let me get this straight. Because Wells Fargo made so much money--and doesn't appear to have lost too much money during the mortgage crisis or at least hasn't lost more money than they made--they didn't need to get bail-out money, saving taxpayers money. Perhaps this is in contrast with other banks that didn't charge fees and made poor choices during the mortgage crisis and needed bail-out money from the taxpayers.

Wells Fargo made lots of money by charging their customers for service, which is sort of the idea of a company which provides a service. You may argue the amounts, and I might agree with you. But they charged the amounts they charged and let the market decide whether they were worth it. You decided they weren't worth it and took your business elsewhere, which is your choice.

Tell me, did the bank you switched to need to take taxpayer money? Have they been absorbed by some other bank?

Re:You can Do that?

[ajs]

It may sound funny, but it's not, and in fact WF is doing the right thing.

If you follow this story, you'll note that they've responded to concerns from investors and the press alike noting that this is a typical process, and that they're not "suing themselves," but filing a motion to have the court intercede in a matter that's federally regulated. They're naming themselves because they're involved in both sides of the transaction, which is correct procedure.

Think of it this way. You buy my car and loan me the money to do so. Then you find that the car isn't up to local lemon laws. You want to take me to court to require me to upgrade the car as appropriate, but the state requires that you name lenders as well as the seller. Thus, you name yourself on the suit. Nothing odd, here, and it's not that you're being stupid. You're just doing the paperwork correctly and getting the end-result that you wanted (upgraded car in accordance with law).

Re:You can Do that?

[ajs]

Sorry, that was a bad example. I meant "you broker a purchase of my car and lend the buyer the money." The rest of the example holds.

Also, I may be wrong about the case in point on a small issue. I think it's state-regulated, not federal. Again, the point holds, but that statement was wrong.

Re:You can Do that?

[Majik Sheff]

I switched to a credit union that has stayed healthy in an otherwise toxic financial environment. The answers to your two questions are 'no' and 'no' respectively.

Re:You can Do that?

[tmosley]

The market decided. The problem is, the government didn't like the decision, so Komrade Bush decided he knew better.

Komrade Obama, of course, agreed wholeheartedly.

Re:You can Do that?

[R3d M3rcury]

Fair enough--and I'm sure that the Credit Union offers the services you want and none of the services that you don't. Sounds like a good decision.

So I suppose my point is that why would you knock a healthy bank that seems to be doing well in a toxic financial environment? I mean, I remember an area bank, Washington Mutual, used to run these fun ads talking about how they didn't charge lots of fees, unlike the other banks. Of course, they were among the first to fail and they ended up getting bought up by Chase.

Re:You can Do that?

[AK Marc]

Wells Fargo is one of the most popular banks in Alaska (having bought out Bank of Alaska), and I think they use heated sidewalks in some locations. They are cheaper and safer than shoveling, and can be better for the environment than chemicals. They usually run off heated water from natural gas fired boilers, not electricity. But that may vary by location. We get more than 100 inches of snow a year in Anchorage.

Re:You can Do that?

[Anonymous Coward]

What kind of idiot would get a mortgage from these...wait, ah crap.

Re:You can Do that?

[blankinthefill]

Just because they don't get loads of snow doesn't mean that heated sidewalks are a bad idea. I think the main thing that they would be trying to avoid is ICE, not snow. Snow gives a relativity firm footing, and is much less likely to slip someone up than ice (or slush). While Des Moines doesn't get much snow, how much ice do they have on their sidewalks during the winter? Do they have a lot of sleet/slush? The Midwest DOES get ice storms that leave large build ups of ice all over everything. In cases like that, heated sidewalks make tons of sense, because its almost certainly cheaper in the long run than chemicals/human labor, and almost certainly leads to safer surfaces as well, since its more likely to melt all the ice in affected areas, unlike chemicals, which cam leave patches of ice in places that are missed be the people laying it down. Either way, my point is that heated sidewalks aren't just for snow, and someplace that gets very little snow could have a strong case for using heated sidewalks.

Re:You can Do that?

[EMeta]

Except you forget: ice on sidewalks means someone is going to slip and fall. And then sue them. Which apparently they don't have enough of these days.

Re:You can Do that?

[Mr2001]

I mean, I remember an area bank, Washington Mutual, used to run these fun ads talking about how they didn't charge lots of fees, unlike the other banks. Of course, they were among the first to fail and they ended up getting bought up by Chase.

WaMu's failure, like other bank failures, was not caused by setting their fees too low. It was caused by making a lot of terrible investments. Wells Fargo may have made up for their investment losses by charging outrageous fees (or maybe they just didn't make as many bad investments), but that doesn't mean charging outrageous fees is necessary for banks to stay in business.

Re:You can Do that?

[beav007]

How could you name anyone other than Darl McBride?

Re:You can Do that?

[sjs132]

"but that doesn't mean charging outrageous fees is necessary for banks to stay in business."

I'm intriged by this idea of "outrageous fees."

I bank where I bank and have moved a few times because of disagreements. (had one that ran an electronic transaction for about $200 out of my account and couldn't provide ANY proof it was mine even when the names and account #'s didn't match up with mine! But, I digress...) Never once was it because of "outrageous fees." What makes a fee outrageous? Isn't it an unnessicary modifyer? (Sorta like George Carlin's Airline "Pre Bording" skit) Isn't any fee going to be considered outrageous if it hits you? Would not the smarter part of the plan be to avoid ALL fees. If that were the case, the banks should go belly up. If enough people don't like a fee or think it high, then they should "vote" with their money and remove it and move to another bank with lower fees. (Again assuming that they intend to pay a fee to bank?)

Eh, maybe it is just me... The more solvent I can keep my account the better I feel. Same for Credit Cards. Pay the balance off, avoid the interest and late fees, etc.

Re:You can Do that?

[Darinbob]

I've got much of my money in Wells Fargo. If Wells Fargo wins the lawsuit, will that help my bottom line, or hurt it? Who am I supposed to be rooting for here?

Re:You can Do that?

[Mr2001]

What makes a fee outrageous?

A sense of disproportion between the amount of the fee and the expense that could reasonably be caused by the event that caused the fee.

For instance, I consider it outrageous to charge $39 when a $10 payment is received one day late. Or to charge $4 for each day that an overdrawn account has a negative balance of $1. Fees like those are essentially short-term loans, but at rates that far exceed the sensible or legal price for an outright loan.

Would not the smarter part of the plan be to avoid ALL fees.

Sure, just like a smart plan to save money on health care is to avoid getting sick or injured.

Eh, maybe it is just me... The more solvent I can keep my account the better I feel. Same for Credit Cards. Pay the balance off, avoid the interest and late fees, etc.

No, it's not just you. Everyone feels better when they're more solvent, and no one wants to pay interest or fees.

What may set you apart from some others is your ability to stay solvent and avoid paying interest and fees.

Re:You can Do that?

[Khyber]

No shit they charge out the ass for fees. Her's what really pisses me off - and this is why I left Wells Fargo - if you have a line of credit and you overdraft on your account, not only do you get an overdraft fee BUT it gets charged as a cash advance at a higher rate on your credit instead of just putting your actual bank account into the negative. And even with ZERO in your primary account they'll just overdraft it to your credit line.

They're a bunch of crooks and they should have every one of their practices exposed.

Re:You can Do that?

[johnsonav]

A sense of disproportion between the amount of the fee and the expense that could reasonably be caused by the event that caused the fee.

For instance, I consider it outrageous to charge $39 when a $10 payment is received one day late. Or to charge $4 for each day that an overdrawn account has a negative balance of $1. Fees like those are essentially short-term loans, but at rates that far exceed the sensible or legal price for an outright loan.

The fee isn't just there to cover the cost. It's there to provide an incentive for you not to do whatever action caused the fee.

They don't charge you a fee when you overdraw an account because it costs them that amount of money. They charge you the fee so you have a reason to not overdraw your account. If they charged a lower fee, more people would overdraw their accounts.

Re:You can Do that?

[dougisfunny]

No, they charge the fee because its profitable, and they have no reason not to.
(Banks in the USA make some $40 Billion a year on overdraft fees)

Re:You can Do that?

[johnsonav]

No, they charge the fee because its profitable, and they have no reason not to.
(Banks in the USA make some $40 Billion a year on overdraft fees)

Of course it's profitable. I never implied that it wasn't. But, I would imagine that banks profit far more than the $40 billion they collect in fees.

Regardless, banks could not function if everyone routinely over-drafted their accounts. So, they need a way to disincentivize that behavior; they charge a fee. I imagine they calculate that fee so that it maximizes the company's profitability as a whole, not simply to maximize the amount of fees collected.

Imagine, for a moment, that a bank charged $1,000 per over-draft. If the bank truly had "no reason not to", would they make more money under this fee schedule, or less?

Re:You can Do that?

[syousef]

In this case the lawyers really are the only winners!

Re:You can Do that?

[Anonymous Coward]

Wells Fargo received $25 billion in TARP funds.

Re:You can Do that?

[Anonymous Coward]

Wells Fargo has made so much money charging their customers fees (I think there might be a fee for fee processing) that they not only didn't need to take bailout money, they can afford to build a nice shiny corporate office with heated sidewalks. HEATED SIDEWALKS.

When I found out that my bank was being bought by Wells Feego I changed banks...

They might not have needed the TARP funds, but really there wasn't much choice in the matter. Our nine largest banks (WFB included) were forced/bullied into accepting the funds. They, as well as the rest of the banks, are paying interest on those funds. These are not reasons to be mad at them.

Re:You can Do that?

[virtualXTC]

They're a bunch of crooks and they should have every one of their practices exposed.

I couldn't agree more!!! A couple years back I decided to sell my car so I could buy a condo but needed my title to make the transaction easier. I called them to ask what my pay out and was sent an official letter of the total amount I owed. I borrowed from my friends and family to pay them off. I payed them the pay-out amount and a week later received a bill as if nothing had happened. I called customer support (1/2 + hold times), and they claimed their department/branch wasn't in-charge of my account, then would transfer me to another department that supposedly should have it as it was some mysterious branch of the bank occasionally disconnecting me and each time forcing me to wait on hold for 1/2 plus. I finally paid the bill to be safe, but also continued to try and contact costumer support. When I did finally get through the operator on the other end claimed I actually OWED another payment. I told her, you must have it all wrong, you owe ME a payment. Finally after about an hour of back and fourth she finally realized that there was no possible way I could owe anything, and she would take care of it and to call back in a week. I called back a week later, waited on hold for an 45 min only to find out that they were changing computer systems and could not access my account. I waited another week and called, this time waiting 1.5 hrs on hold to fond out that there is no record of my account, bounced me around on hold (surprisingly they kept the bouncing around under 10 min), but now but claimed the only way to fix things was to let my account default which would take 60 days! I tell them I'm trying to sell my car and need my title as I have a buyer. They claim they are sorry but that there is no other way. I convince the buyer to wait 2 months as it's over x-mas and they'd be away for most of it anyway. 30 days later, I start getting calls from collections agencies. Not only did they not send me a letter of default, but they sent me directly to creditors and ruined my credit. I called to complain, but they refused to talk to me because the collections agency now owned my account. I'd call the agency, and they'd tell me that they had no record of my prior conversations and that I owed 2 payments!!!!

I finally contacted a lawyer! Started documenting my phone-calls and getting the # of people I had talked to, but to no avail. Unfortunately, during this time my car buyer left and I missed an opportunity to buy a property I actually wanted. With my credit shot, i started looking at less expensive places and came across some pre-fab homes that who else, but wells fargo was trying to be the exclusive financier for. The finance guy asked if I wanted a pre-approval from him, to which I replied yea, and I'd like your company to stop fucking me. And mumbled something to the effect that he's lucky there aren't any other customers here because I would ensure he couldn't make a loan. Shocked, he acted concerned and promised to help. Doubtful, I gave him my #. I did get one call about a pre-approval from him, but had to remind him about my situation. He finally convinced me to give him some more info and that he would look into it. After a few days, I started calling him back. After hounding him for a week he apologized and had found that my story was indeed true!!!!! He put me in contact with a semi-competent rep who slowly worked to resolved the issue. It took another 3 months to get the lean on my car. The buyer for my car, and the place I wanted, long gone. I'll never do business, or let a friend do business with them again!

Re:You can Do that?

[virtualXTC]

A quick google will show 400 ppl backing Majik Sheff. I don't know much about fees, but I spent more than 15 hrs on hold trying to fix a problem on THEIR END.

Re:You can Do that?

[Anonymous Coward]

well said. there should be no corporation too big to let it fall under its weight. unemployment risk is as fake political shielding as it gets, as other will quickly come to fulfill the previous industry role, in a better way.

Re:You can Do that?

[10101001 10101001]

Regardless, banks could not function if everyone routinely over-drafted their accounts. So, they need a way to disincentivize that behavior; they charge a fee.

Beyond the grand "everyone" overgeneralization--since any type of overdraft fee, even a very small one, would invariably cause many not to overdraft--, you've just described exactly how banks function, to pool the resources of many and allow an "overdraft" (ie, loan) for several members. It's illogical to outright disincentivize the very business one is in.

I imagine they calculate that fee so that it maximizes the company's profitability as a whole, not simply to maximize the amount of fees collected.

And because most banks are propped up by the government (they can take out great, low-interest loans), those fees tend towards monopolist or oligarchical pricing for a lot of people. Even without governmental help, banks generally have enough capital that new players have a rather larger burden to compete, even if they plan to undercut oligarchical pricing. Even more generally, there's a finite amount of players reasonably possible in an area which you are likely to have readily access to; thankfully for most people, it's just a matter of switching banks/credit unions to one without outrageous fees. But, once you have a remotely bad loan, not a great credit history (since you simply never took out many loans), or simply aren't very profitable, the mostly saturated "good" banks will likely just let their competitor profit since they've already absorbed most of the best customers.

Imagine, for a moment, that a bank charged $1,000 per over-draft. If the bank truly had "no reason not to", would they make more money under this fee schedule, or less?

And if you charged 100% or more interest a day on any other type of loan, most people would consider that loan sharking, regardless of how much it might actually maximize profit for said loan shark. At some point, loan sharking was made illegal because it was recognized that the behavior was so horrible, it was not reasonably fair to allow the behavior to continue even if some people were desperate enough to take advantage of such loans. Having said that, I'n not exactly arguing that overdrafting fits into the same area--I don't know enough about the norms, etc or their long-term consequences--but I would generally state that loan sharking is evil and should be illegal; so it really does come down to whether overdrafting is like loan sharking enough for the discussion to be a governmental issue or whether the free market is the better tool.

Re:You can Do that?

[Anonymous Coward]

That's heated pavements, you insensitive clod!

Re:You can Do that?

[HungryHobo]

If that were the case, the banks should go belly up
Not so much.
I pay no fee's unless a direct debit bounces or I apply for an overdraft.
But then I'm in europe. I've heard some horror stories from friends in the US- one beauty was someone who opened an account with a small amount of money, a few weeks later withdrew some of it, got hit with a fee for the transaction, got hit with a fee for going into overdraft, then got hit with more fees because they didn't bother to notify him that he owed them money and it went more than 14 days or some such without him knowing about it and he ended up with a bill for over 200.

At least here my bank is required to notify me first if I'm about to do something which will entail a fee(like requesting extra statements or some such). If I request 20 from the atm and I have 10 or I request 10 and there's a fee for using the ATM the bank can't just silently let me slip into overdraft, the transaction gets denied.(unless I have agreed to go into overdraft)

How hard is this?
It's basic consumer protection legislation.
Does the US have no basic consumer protection legislation?

Re:You can Do that?

[Anonymous Coward]

obligatory comic

Re:You can Do that?

[Mr2001]

Regardless, banks could not function if everyone routinely over-drafted their accounts.

Sure they could: banks don't need to allow overdrafts at all. If there's $80 in my account and I write a check for $100, the bank doesn't need to take $20 out of their own funds to pay the check -- they can return it unpaid and let me deal with the consequences. But they'd rather loan me the $20 so they can charge hefty overdraft fees on top.

Re:You can Do that?

[HungryHobo]

How about this as an even better solution if they don't want you to go into overdraft:
I put my card in the ATM.
I type in my pin.
I request 20.
I only have 10 in my account.
A message pops up telling me I don't have the funds.
It ain't that hard.

They let people go into overdraft easily because fee's are profitable.
Interest on loans isn't profitable enough for some banks.

Re:You can Do that?

[HungryHobo]

banks could not function if everyone routinely over-drafted their accounts

Sure they could, overdrafts tend to be tiny compared to the amount many have in savings.

Re:You can Do that?

[Dopefish_1]

Sure they could: banks don't need to allow overdrafts at all. If there's $80 in my account and I write a check for $100, the bank doesn't need to take $20 out of their own funds to pay the check -- they can return it unpaid and let me deal with the consequences. But they'd rather loan me the $20 so they can charge hefty overdraft fees on top.

But allowing you to overdraft your account is a valuable service. If my balance is $20 short to cover my rent check, I'd sure as hell rather the bank pay it anyway and charge me an overdraft fee, rather then bounce the check and get nailed with a late fee + bounced check fee + hassle from my landlord.

Re:You can Do that?

[linuxrocks123]

Did they eventually give you the $200 back? What bank was that?

---linuxrocks123

Re:You can Do that?

[Akatosh]

When did it become normal to have no clue how much money you have and accidentally overdraft your banking account? How about keep track of your finances so when you have $10 you don't try to take $20 out? You can even check your balance on that very same atm! How about reading the little sign that says what the atm charges and use a FREE atm? Personal responsibility, hello????

Re:You can Do that?

[TRS80NT]

Effectiveness also depends on the lay of the land. A building I work in (in Wisconsin) has heated sidewalks for the front entrance, which is on a hillside slope. Under certain conditions of snow amount and temperature the heated area produces runoff which freezes into layers of ice which make the nice, clear sidewalk almost impossible to get to. Several times a winter they have to turn off the sidewalk and clear it the old-fashioned way.

Re:You can Do that?

[DinDaddy]

So it is seriously your position that they set these fees at the level they do to discourage the behavior that generates these fees for them, and not at the highest level they think they can get away with without triggering government regulation spurred by public outcry?

These fees are the only way they make money off most low balance consumer accounts, and they use any means they can to increase them.

Do you also believe parking meters' time limits are set by cities to be slightly more than the average period needed by people performing their errands?

Re:You can Do that?

[johnsonav]

So it is seriously your position that they set these fees at the level they do to discourage the behavior that generates these fees for them, and not at the highest level they think they can get away with without triggering government regulation spurred by public outcry?

My position is that they set these fees at the level which maximizes the bank's profitability. The actual money collected through these fees is only one aspect which must be considered.

Do you also believe parking meters' time limits are set by cities to be slightly more than the average period needed by people performing their errands?

No, the meters' time limits, and the amount they charge is (or should be) set in such a way so that they effectively charge what that space is worth.

Re:You can Do that?

[johnsonav]

Sure they could, overdrafts tend to be tiny compared to the amount many have in savings.

Sure, overdrafts tend to be tiny when these kinds of overdraft fees are involved. Do you really think they would be so tiny if there were no fee?

Re:You can Do that?

[HungryHobo]

since many banks charge the same fee no matter if you go $1 or $100 into overdraft.
NO

Re:You can Do that?

[HungryHobo]

For the same reason most of the world doesn't listen to fools like you when writing legislation to deal with loansharks.

Because it exploits the poor.
Because it stinks of corruption and weak regulators.
Because "Caveat emptor" is an idiots approach to consumer protection.

It's as much about personal responsibility as situations involving young women and dark alleys.

You know what?
I've never paid a fee for trying to withdraw more than I have in part because retards like you didn't get to write the laws on the matter here.

The example transaction is exactly what happens if I try to withdraw more than I have.
You're getting fucked up the ass by banks in the US and you know why?
Because of idiots like the above poster who make excuses for them and their scams.

Re:You can Do that?

[johnsonav]

since many banks charge the same fee no matter if you go $1 or $100 into overdraft.
NO

You haven't accounted for the number of overdrafts, only the dollar value per overdraft. Any such accounting is woefully incomplete.

Re:You can Do that?

[onemorechip]

Ah well, there's bound to be a car analogy in every /. story these days.

Re:You can Do that?

[HungryHobo]

gods sake.
If they wanted to cut down on the number of overdrafts they'd just not allow them at all or only allow them after you apply for them.
It's not that hard to deny a transaction rather than charging 40 dollars because your paycheck hasn't cleared yet and you're a dollar into the red after using the ATM or the fee for using the ATM pushed you into the red.
Hell how hard would a "this transaction will push you into overdraft. continue? Y/N" prompt be?

It's on a par with loan sharking.
It exploits the poor.
It most certainly is not to discourage people from getting overdrafts.
It looks more like it's designed to try to make sure people inadvertently go into overdraft.

Re:You can Do that?

[hesaigo999ca]

This is the closest thing to an economic version of the universe imploding on itself...
I hope that for all the wrongs they have done, they get theirs handed to them....by themselves!
I hope they are as arrogant, hypocritical, spiteful to themselves as they are to their own client's and
spare no expense to prove it to themselves!!!

Re:You can Do that?

[Viper Daimao]

I believe Wells Fargo didn't even want to take the taxpayer money, but the Treasury made all the banks take money, so as not to indicate which ones really needed the money.

Re:You can Do that?

[Mr2001]

But allowing you to overdraft your account is a valuable service. If my balance is $20 short to cover my rent check, I'd sure as hell rather the bank pay it anyway and charge me an overdraft fee, rather then bounce the check and get nailed with a late fee + bounced check fee + hassle from my landlord.

If you want to opt in to this service, and pay a reasonable price for a short-term loan, that's one thing. But banks assume that every customer wants their checking account to provide short-term loans, and then they charge a fee that far exceeds the market price for such a loan ($39 overdraft fee in a month where your balance hits -$20 comes out to 2340% APR).

Re:You can Do that?

[Anonymous Coward]

I think Wells Fargo should be renamed "We Will F*** You" (since we're on the subject. That is exactly what they did to me, a hard-working single mom about a year ago when they took me out of a 5.5% fixed rate mortgage and put me into a 9.75% ARM, somehow convincing me it would be in my best interest. I only wanted to consolodate some credit card debt and they decided to take advantage of me as they absorbed my car loan and sucked all the equity out of my home and charge extra fees so they could pocket the profits at my expense. I of course am an idiot to have signed into this loan, which all happened in a matter of about 2 wks., in which my head is still spinning. I didn't even go looking for them, they somehow found me..now I'm thoroughly screwed + they won't do a f***in thing to help. So I, too hope they F*** themselves into oblivian!!!

Re:You can Do that?

[Anonymous Coward]

If Wells Fargo wants to build new corporate offices (even with heated sidewalks) what's the problem? Almost all firms either build or take out long-term leases.
Wells Fargo bought my mortgage ten years ago and I've had zero problems with them. No mystery fees. No surprises. If anything, they were a step up
from the guys I was dealing with before.

Latest news

[Yvan256]

Sales of mattress have started picking up again.

Re:Latest news

[Artifakt]

If companies can be this screwed up and turn a quarterly profit what will ultimately pick up is sales of barrels and suspenders. (unless you mean the mattresses should be put under Wall Street windows rather than used to hold your money.).

Re:Latest news

[Anonymous Coward]

I hope so. I just bought 2000 shares of Sealy.

Re:Latest news

[BobMcD]

I'll admit that I didn't get it at first. If you're also otherwise clueless - mattress as in a place to put your money.

The reason it didn't 'click' with me is the disconnect between needing a bank and needing a new mattress, but hey, points for effort. :)

Re:Latest news

[Larry Lightbulb]

I keep my money in a numbered Swiss mattress.

Not if I see me first!

[SmallFurryCreature]

Just for this story we should be able to mod ourselves :)

Re:Not if I see me first!

[ScoLgo]

Yeah, but I would have to mod myself redundant.

Dammit.

Re:Not if I see me first!

[K. S. Kyosuke]

What, like Kevin Warwick?

Re:Not if I see me first!

[EvanED]

Yeah, but you'd immediately have to metamoderate your moderation down, so it works out in the end.

Re:Not if I see me first!

[FlyingBishop]

Actually, I think it's a whoosh to those that modded him funny. The person who modded him redundant was doing his part for a +5 redundant mod, which I think we can all agree was the correct mod.

Re:Not if I see me first!

[ScoLgo]

"Actually, I think it's a whoosh to those that modded him funny. The person who modded him redundant was doing his part for a +5 redundant mod, which I think we can all agree was the correct mod."

Yes, exactly what I was going for as that would have been funny. Ah, well...

Re:Not if I see me first!

[tenco]

+5 redundant? Are you an IT professional? :)

Re:Not if I see me first!

[tenco]

You mean, we are moderating all our own post? Wow, that just blew my mind...

Re:Not if I see me first!

[EvanED]

It is possible... 1 redundant, several underrated mods.

Moderators, you know what to do!

Re:Not if I see me first!

[masmullin]

Yes, exactly!

Re:Not if I see me first!

[derblack]

Yes, exactly!

me too

Re:Not if I see me first!

[beav007]

It's the power of "Underrated". I'm still unsure whether Underrated should make negative scores go up or down. Same goes for"Overrated", actually...

Re:Not if I see me first!

[Anonymous Coward]

Posting to undo moderation

Re:Not if I see me first!

[Anonymous Coward]

I know you were only half-joking, but [Over/Under]rated should definitely have the same behaviour no matter what the current score. Firstly, the moderation refers to the post and not the score (that's what meta-moderation is for). Secondly (and more importantly), if Slashdot had different behaviour based on current score, delays between selecting the moderation in the dropbox and clicking "Moderate" at the bottom may result in posts going in the opposite direction than the one intended - in that delay, someone else could moderate the post and alter subsequent modification behaviour without the original moderator's knowledge. The only way this could work is if to moderate you needed the freshest page available (which would make moderation for slow-connection users impossible - by the time they get a page it's already out-of-date), and the moderation would need to happen immediately after selecting the option in the drop-box (and we already have enough people mis-moderating as it is, without taking away the two-stage confirmation). So, not only is it contradictory to change the behaviour of the moderation based on current score, but it is also extremely logistically difficult, if not impossible.

Re:Not if I see me first!

[cerberusss]

+5 redundant? Are you an IT professional? :)

He works at Google.

seriously?!

[evilkasper]

This sounds like something out of HitchHikers or a Python sketch.

Re:seriously?!

[$RANDOMLUSER]

Or the latest from SCO.

Re:seriously?!

[Anonymous Coward]

This sounds like something out of HitchHikers or a Python sketch.

How about Kids in the Hall?

http://www.kithfan.org/work/transcripts/three/sexhimself.html

Re:seriously?!

[SputnikPanic]

To me it sounds like one of the signs that our society has become a big game of Jenga.

Re:seriously?!

[MobileTatsu-NJG]

This sounds like something out of HitchHikers or a Python sketch.

Sounds more like Dilbert to me. "Basically we pay ourselves to hose ourselves."

Re:seriously?!

[Anonymous Coward]

Wasn't that from the Rutles? Didn't Stig sue himself?

Not only act of idiocy

[Coldeagle]

I'm currently in the process of purchasing a property owned by Wells Fargo, and I'm also using Wells Fargo for the mortgage. Honestly, I'm getting messages from the company that's servicing the property that the seller wants the deal closed as soon as possible, and that I need to pressure the lender! I mean honestly, this and the example listed here are a perfect example of how a bank can get so large that they can't even deal with themselves. Who would have thunk a fictitious person could develop schizophrenia!

Re:Not only act of idiocy

[scubamage]

If you think that is bad, I pray that you never have to deal with Verizon at a corporate level. So many divisions, and each one is run like its own company and is completely separated from the others. It's pathetic.

Congrats on the purchase, btw! :)

Re:Not only act of idiocy

[AndersOSU]

Too big to not fail?

Re:Not only act of idiocy

[tylersoze]

Yeah I don't know what's going on at Well Fargo. I have an auto loan through the company and they just sent me a letter telling me that I better make sure I have them listed on my insurance as something or other or they would purchase their own insurance and add it to the loan amount. That's the first time I've ever received anything like that on any car loan I've taken out.

Re:Not only act of idiocy

[Anonymous Coward]

The seller wants you to close as soon as possible because they know if they lose this sale, they will be waiting a long time and getting a lot less for the house.

Re:Not only act of idiocy

[AndersOSU]

Probably because in the past you've promptly notified your lender that you have insurance.

I got a similar note from my lender (a local credit union) on my car loan 4ish years ago. They're just covering their bases and making sure you have the insurance mandated in the loan agreement - if you don't they charge you out the ass for theirs.

Re:Not only act of idiocy

[TubeSteak]

I'm currently in the process of purchasing a property owned by Wells Fargo, and I'm also using Wells Fargo for the mortgage. ... Who would have thunk a fictitious person could develop schizophrenia!

It's only confusing if you assume that corporations are one monolithic entity.
The truth is that they are made up of numerous units, branches, fiefdoms, etc etc etc.
It makes perfect sense for the property sales unit and the mortgage unit to be pursuing different agendas.

Re:Not only act of idiocy

[Anonymous Coward]

Coldeagle, as someone who placed an offer on a house in November but did not get possession of a Wells Fargo house until February, sit back and relax (and my mortgage company was ready to go 14 days after the offer) -- I got a $60,000 discount on a 2 year old house!

Re:Not only act of idiocy

[autocracy]

That separation is government mandated anti-monopoly work stemming way back from Ma Bell time. The lender thing might be related to SEC rules. The lawsuit is just retarded. I hope the judge fines the plaintiff for wasting his time...

Re:Not only act of idiocy

[RichardJenkins]

It's prefectly believable and easy enough to understand - but it damn sure doesn't make any sense to me.

Re:Not only act of idiocy

[FiloEleven]

It's only confusing if you assume that corporations are one monolithic entity.

In fact, they're the exact opposite of a monolithic entity.

The monolith made our monkey ancestors more intelligent. Corporations are making us more stupidity again =(

Re:Not only act of idiocy

[tmosley]

I certainly wouldn't, but my alternate personality thinks you're nuts!

Re:Not only act of idiocy

[iamhassi]

Don't use Wells Fargo.

I had a investment property, and the loan was sold to Wells Fargo. Several years ago I fell behind three months, so we reached an agreement and I started paying monthly again but that 3 months was always over my head. Well 2 years later the they wanted the 3 months + interest. I paid them the 3 months but didn't have the payment for the interest and continued making monthly payments. 6 months later they again wanted the interest. Told them I didn't have it so they foreclosed, but first they surprised me with a check equaling a year's worth of payments. I was told it was because they misappropriated my payments.

Two months after the house was foreclosed they put it back on the market for about 1 year's worth of payments. It's been on the market for nearly a year now.

Had they simply let me continue making payments they would have already made more than the price they're selling the house for. I'd love to just go pay for the house with cash they sent me, but it's been vandalized since and much of the $$$ was spent on purchasing and moving to a new house.

I don't think anyone at Wells Fargo knows what's going on. As a tax payer I'm disappointed that my $$$ went to a bank that wastes money.

Re:Not only act of idiocy

[PainKilleR-CE]

It also has a lot to do with the merging of two companies to create Verizon in the first place, and GTE, at least, was already like that from buying up multiple companies in the past. When Verizon was formed, the division of GTE I worked for was sold to another company, and THAT company, also having spent a lot of time buying companies, was also that way.

The company I work for now is similar, with the specific group I work for having been part of a different company a few years ago. However, they seem to handle it a little better than either of the previous companies did.

Re:Not only act of idiocy

[AndersOSU]

I hope the judge fines the plaintiff and the defendant for wasting his time.

Re:Not only act of idiocy

[AndersOSU]

even if you understand that, the fact that this nonsense ends up in court means there's no one in a management position prepared to actually make decisions.

Ok, different divisions have different objectives, but it's the job of the CEO to manage the company as a whole. This should all be resolved in conference room 101 internally

Re:Not only act of idiocy

[plague3106]

It makes perfect sense for the property sales unit and the mortgage unit to be pursuing different agendas.

No it doesn't, its still one company. There should already be a procedure in place to handle these kinds of conflicts. The fact that there isn't just shows we should have let this bank fail, because clearly they don't know what the fuck they're doing.

Re:Not only act of idiocy

[ptbarnett]

I have an auto loan through the company and they just sent me a letter telling me that I better make sure I have them listed on my insurance as something or other or they would purchase their own insurance and add it to the loan amount.

It's somewhere in the fine print of your loan agreement: as the secured creditor, the bank wants to be sure they are the first beneficiary of any payment from your insurance company if the vehicle is totaled.

I'm not sure why it's the first time you've seen it: it's always been a requirement for vehicles that I financed.

Re:Not only act of idiocy

[PainKilleR-CE]

Actually, it depends on the lender. I spent a number of years paying too much for my car insurance because I paid for the level of insurance they wanted me to have in order not to have the insurance they would buy for me. I switched insurers when I moved and forgot to tell them (and got a better rate), and by the time I found out they had already started charging me, $50 a month. I could've saved myself almost $200/month on my insurance policy if I had just asked what they were going to charge for the insurance.

Of course, it should be noted that insurance only covers them for the value of the loan, so you still have to carry whatever insurance you feel secure carrying, but you shouldn't just carry whatever they want you to unless it really is cheaper than their insurance.

Re:Not only act of idiocy

[mr_mischief]

So we can bail out Wells Fargo for unforeseen expenses they incurred?

Re:Not only act of idiocy

[LuvlyOvipositor]

In fact, they're the exact opposite of a monolithic entity.

The monolith made our monkey ancestors more intelligent. Corporations are making us more stupidity again =(

You might be confusing RL with Stargate a little bit.

Re:Not only act of idiocy

[Chris Mattern]

It makes perfect sense for the property sales unit and the mortgage unit to be pursuing different agendas.

But it makes no sense at all that the manager at a suffciently high level to have authority over both of them isn't making sure that the different agendas don't escalate to the point where they're trying to bash each others' brains in. That's his job.

Re:Not only act of idiocy

[AndersOSU]

sure.

We can use the unforeseen revenues we accrued in the legal system.

Re:Not only act of idiocy

[radtea]

this and the example listed here are a perfect example of how a bank can get so large that they can't even deal with themselves.

It's not the size, it's the stupidity.

Everything I know about management I learned from the "telephone game" we played as kids, where you whisper a message around in a circle and find that after about three hops it gets completely mangled.

Stupid people ignore this phenomenon, and go through their lives acting as if telling someone something once is sufficient to get the message across. Stupid people run stupid organizations that radically under-communicate. Some people who are both stupid and evil use this to create private fiefdoms within organizations.

Smart people recognize this phenomena, and create organizations with multiple, redundant and simple lines of communication, and work to keep policies clear and concise so they are harder to mangle in the communications process.

Organizations run by stupid people are therefore extremely complex and hard to understand, whereas those run by smart people are generally simple. This leads stupid people--who are vastly in the majority--to think that organizations run by smart people aren't very capable, because they are too stupid to realize that capability comes with simplicity, not complexity.

Corporate America is hugely invested in the myth of complexity, and hires and trains managers accordingly. Attempts to simplify are fought at every turn. This creates the kind of environment where an organization can actively pursue and defend a lawsuit against itself, by itself, rather than carrying through the pro-forma motions required by law, because the people on both sides are too stupid to consider any other possibility.

And remember: this comes down to a couple of people. They are embedded within a large organization, but it is at the end of the day just them. It isn't like there are huge teams on this. An organization with clear lines of communication and responsibility would make it easy for the people in question to talk to each other, and the issue would be resolved. But that would be smart, and there is nothing smart about the people working for American banks these days.

Re:Not only act of idiocy

[Anonymous Coward]

I was talking to the Verizon techs who were installing fiber for me the other day. One of them had been there since 1998 and apparently he's had 15 different managers since. The other guy had been there for 4 years and gone through 4 managers, although the 5th was actually the manager who originally hired him.

Re:Not only act of idiocy

[NickW1234]

You might be confusing Stargate with 2001 a little bit.

Re:Not only act of idiocy

[cob666]

In fact, they're the exact opposite of a monolithic entity.

The monolith made our monkey ancestors more intelligent. Corporations are making us more stupidity again =(

You might be confusing RL with Stargate a little bit.

You might be confusing Stargate with 2001: A Space Odyssey a little bit

Re:Not only act of idiocy

[Tanktalus]

Because the people doing real work, who knew what they were doing, were to important to be promoted into doing other things.

Re:Not only act of idiocy

[gnick]

Corporations are making us more stupidity again =(

There's something oddly beautiful about that statement. But it hurts my brain as I try to figure out exactly what.

Re:Not only act of idiocy

[tnk1]

You might be confusing Stargate with 2001: A Space Odyssey, by Arthur C. Clarke, a little bit.

Re:Not only act of idiocy

[Kindgott]

I know all about the Verizon deal!

The company I work for recently switched from Verizon landlines to some sort of business VOIP service they were offering, ostensibly to save money.

The switch happens, with a few hitches not relevant to this discussion, and everything is running fine. Then, we get our Verizon bill, which contains a contract termination fee from Verizon. Apparently, our copper was being services by one arm of Verizon, and the FlexIP VOIP service was another arm of Verizon entirely.

Management has been fighting for over a week to get the termination fee waived, hopefully it'll get sorted out.

Re:Not only act of idiocy

[DarKnyht]

And if you are smart you will jump through the hoops for the twenty times they will require it. I informed them and my insurance company at vehicle purchase, when I got said letter, and multiple times after the fact.

In the end, I had to threaten Wells Fargo with the Better Business Bureau in order to get them to remove the charges for insurance that I refused to pay for (since I had already been insured and notified them multiple times of it). Even then, it took two months to get the statements fixed (or least I gave up at that point, I still am fairly sure they screwed it up.)

As a Wells Fargo customer, the best advice I can give you is find another company to do business with even if the deal is not as good. That extra money paid is well worth avoiding Wells Fargo's stupidity.

Re:Not only act of idiocy

[fishbowl]

>much of the $$$ was spent on purchasing and moving to a new house.

Neat trick, defaulting on a mortgage and getting a new one. Some people can't get a mortgage even with good credit.

Re:Not only act of idiocy

[fishbowl]

And you suggest that even if the matter cannot be settled amicably between business units, that those business units should be denied access to the courts? And this is just because they use the same franchise trademark?

I think you'd be surprised how much litigation happens between business units of the same enterprise, in the banking and finance sectors. It's unavoidable in some cases, since so much of the industry is regulated by laws of different jurisdictions.

Re:Not only act of idiocy

[lgw]

Clearly you don't understand banking. Wells Fargo didn't waste any of their smart bankers on operations or procedures - how silly would that be? They directed their brainpower towards bribing the government for handouts! Has they been smart and efficient, they just would have gotten smaller handouts. Working hard to make your business a success is the sort of thing a free market rewards, not the sort of thing a corrupt government rewards. Who are you to criticise - how many billions of taxpayer dollars did you get, hmmm?

Re:Not only act of idiocy

[gzunk]

I bet it isn't actually one company. I would have thought that the property sales unit and the mortgage unit are probably seperately registered companies in their own right, who just have the same shareholders, which is a parent shell company. Probably in Barbados somwhere.

Re:Not only act of idiocy

[scubamage]

Tell them to stay vigilant and keep copies of EVERY payment. Eventually verizon will relent and work with you, but it'll take a few months.

Re:Not only act of idiocy

[lgw]

Substitute "software" for "organization" in your post and it's even more true. You'd think at least that people with "egineer" in their job title would appreciate the simple solution over the complex, but sadly activity will always be rewarded over productivity.

Re:Not only act of idiocy

[Turken]

Well, the REALLY smart thing to do is live with a cheap old car as long as you possibly can while making payments into your own savings account towards a new car. Then buy the new car with cash and forget the bank financing entirely. Once the purchase is done, continue making payment towards the next new car. By deferring the first new car a couple years to begin with, you can put yourself in a positive cycle that will yield thousands in savings for years to come.

Re:Not only act of idiocy

[LaminatorX]

Everyone knows it. The thing that is in Room 101 is the worst thing in the world.

Re:Not only act of idiocy

[vlm]

I'm not sure why it's the first time you've seen it: it's always been a requirement for vehicles that I financed.

No, that's probably not the reason at all. I had a similar situation with countrywide mortgage (since bankrupt and bought out, could not have happened to a better bunch of crooks).

The deal is, if they throw out paperwork, they make more money charging fees for arranging their own insurance.

As long as they make legal action too expensive (binding arbitration by the King Of Timbuktu, etc), its cheaper for the screwed customer to remain screwed.

Somehow I dodged the bullet after mailing and faxing the info multiple times, but I guess I was just lucky. Registered mail was next. Also property insured by multiple insurers is a classic insurance fraud setup.... having my ins company yell at them might have helped.

So, if they do something incompetent, they make a little more money. Therefore, they strategically pick victims, throw out paperwork, then send multiple HELOC and refinance offers per week, with the legally mandated notification in the middle so it will hopefully be overlooked, then throw out incoming mail and faxes, then make extra money.

Re:Not only act of idiocy

[Anonymous Coward]

I am not permitted to tell some of the stories I know about Wells Fargo. However, your example is not the most insane of them. It's just part of the pattern. I long ago stopped finding it surprising when Wells Fargo does something bat-shit insane. Nor am I surprised when the US federal government invests in the craziest entities it can find.

Re:Not only act of idiocy

[pwizard2]

In the end, I had to threaten Wells Fargo with the Better Business Bureau in order to get them to remove the charges for insurance that I refused to pay for (since I had already been insured and notified them multiple times of it).

While it sounds intimidating, the Better Business Bureau is not a government agency and is therefore powerless to make a company do the right thing. (If you want to play that angle, just hope the guy you're talking to doesn't know that) If you really want to put the fear of God into a business when they try to rip you off, I heard you should threaten to talk to your state Attorney General instead.

Re:Not only act of idiocy

[dkleinsc]

Introducing complexity into the areas around one's job is an excellent way to prevent yourself from being moved from that job. If you're someone who's still heading up the corporate ladder, that's a foolish thing to do (because that effect prevents you from being promoted), but once you reach the point where the Peter Principle starts being a factor, this becomes known as "job security". It's one of those instances where what's good for an employee is bad for a company, and it's pretty close to impossible to prevent in a large organization.

This goes for code as well: the best programmers are the ones who simplify their code as much as possible, throwing away bad code left and right. The worst programmers are the ones who use incredibly complex processes to do incredibly simple tasks (these folks are even worse than programmers who produce no code at all because of the damage they do to good programmers' productivity).

Re:Not only act of idiocy

[Critical Facilities]

Something's not adding up in your story. First of all, (and I'll probably get modded into oblivion for this) it sounds like you bought a house you either couldn't afford or were unwilling to pay for. You calmly claim that you "fell behind" 3 months, were allowed to enter an agreement with the bank to fix that problem, and still complain that in 2 years they wanted their money with interest....the nerve!! Let's put the shoe on the other foot. If your employer stopped paying your check for 3 months, wouldn't you want your money back ASAP and with some interest?

I also do not understand how you were able to repay the 3 month's worth of mortgage owed, but were unable to come up with the interest on the delinquent charges. How is it that in 2 years and 3 months, you couldn't come up with the interest on the 3 month's payments?

Then, to top it off, you claim that your home was foreclosed on, you were refunded 1 year's worth of payments, and that the house was put on the market for 1 year's worth of house payments. I'm going to have to call B.S. on this one. I realize that we're in a "down market" as they call it, but trying to tell me that your home went back on the market for 1/30 of its original price is a little much.

Re:Not only act of idiocy

[mccrew]

Sadly, this is the norm as organizations get large.

Remember this, as the largest and most dysfunctional organization of them all is about to be in charge of your health care. Good times!

Re:Not only act of idiocy

[plague3106]

Touche.

Re:Not only act of idiocy

[__aasqbs9791]

That's very true. Every business I've ever known anyone to work at has had a serious problem with communication. The left hand doesn't know what the right hand is doing, even when directly told because the way it was said was misinterpreted. Some of these have been very large companies (American Express) and some have been small companies with a dozen (or less) employees. I think the only ones I've worked for myself that didn't have this problem was because they didn't really need to communicate in anyway because we all worked pretty much independently and didn't need/benefit from cooperation due to the nature of the work.

Re:Not only act of idiocy

[nine-times]

Two months after the house was foreclosed they put it back on the market for about 1 year's worth of payments. It's been on the market for nearly a year now.

Had they simply let me continue making payments they would have already made more than the price they're selling the house for. I'd love to just go pay for the house with cash they sent me, but it's been vandalized since and much of the $$$ was spent on purchasing and moving to a new house.

Yeah, this is the most disturbing thing to me is that it doesn't genuinely benefit anyone. You lost your house. The bank that owned your mortgage made less money out of the deal. Your neighbors probably lost value in their homes by having a cheap, vandalized, vacant house next door. Probably some of all of our tax dollars are going to end up covering the losses one way or another.

I've heard other similar stories, even some where the house becomes so heavily vandalized that the bank decides not to bother to sell it anymore and essentially abandons ownership. Why not just work out some kind of a deal with the occupant?

Re:Not only act of idiocy

[AndersOSU]

yes.

The court shouldn't waste it's time with internal disputes. Anytime a company sues itself the courts should automatically find for the defendant. As soon as that's the policy you won't see any of this nonsense anymore. After all, the courts have more important things to do, like wage the war on (some) drugs.

Re:Not only act of idiocy

[KUHurdler]

I can vouch for this as well. I tried to buy a foreclosure house, owned by Wells Fargo. After 6 months of placing a good offer on the home, and trying to find someone that CAN sell the home, I gave up. It was a shame, I think they eventually took less than my offer. I just couldn't wait around any more. They obviously didn't care if they lose money or not. I initially thought they were just overloaded with foreclosures, but I now think they were just incompetent. I'm sure they can operate for quite a while using government funding.

Re:Not only act of idiocy

[DragonWriter]

It's only confusing if you assume that corporations are one monolithic entity.

Which, legally, they are: a single, distinct legal person. That's, in fact, the whole point of a corporation.

Re:Not only act of idiocy

[Anonymous Coward]

Too-Big-Not-To Fail!

Re:Not only act of idiocy

[alx5000]

It's the stupidity, economist! ;)

Re:Not only act of idiocy

[Anonymous Coward]

That separation is government mandated anti-monopoly work stemming way back from Ma Bell time. The lender thing might be related to SEC rules.

The lawsuit is just retarded. I hope the judge fines the plaintiff for wasting his time...

They should fine the plaintiff, but not the defendant. That wouldn't be fair.

Re:Not only act of idiocy

[Anonymous Coward]

To be fair, you can't control who sues you, so the defendant can't be held liable for defending themselves.

:-)

My question is, what happens if the judge finds for one side or the other? If the defendant is ordered to pay the plaintiff damages, how can we prevent the plaintiff from claiming no restitution has been transacted?

Re:Not only act of idiocy

[Anonymous Coward]

> but trying to tell me that your home went back on the market for 1/30 of its original price is a little much.

1/10 ... remember that you pay about 3x the selling price over 30 years. Depending on where this is, it could be nearly 10% of "peak value" ... especially now that it is vandalized.

Re:Not only act of idiocy

[Anonymous Coward]

Small problem. Those are dwarfed by the clearly-foreseen revenues accrued by the lawyers.

Re:Not only act of idiocy

[ganjadude]

only if he fines the defendant as well will justice be served...

Re:Not only act of idiocy

[MHolmesIV]

Actually, for a 30 year mortgage at current interest rates, 1 years payments (if you include PMI and tax payments to an escrow account) would be around 1/10th the cost of the house. I'd be guessing the original poster didn't get the sweetest interest deal either, since it was an "investment" property, and banks tend to consider those higher risks.

It's still a stretch, but in some areas of the country, if you add vandalism to it, it's at least plausible.

Re:Not only act of idiocy

[Bourbonium]

I have another horror story about Wells Fargo. I serve as treasurer for a non-profit organization which leased a high-speed multifunction copier/printer/scanner/fax machine in 2001 to print our newsletter. The lease was for five years and administered through Wells Fargo Financial Leasing. At the end of the five years, after paying thousands of dollars in lease payments at $300/month, they told us that to close the lease, we could either purchase the machine outright for $360, or pay $500 to have it shipped to a recycling/salvage facility in Texarkana, Arkansas. The non-profit, of course, decided to pay the $360 and contract with a local printer company to service the machine, which still worked well, even though it was no longer under warranty.

Everything seemed fine until Wells Fargo started sending us bills about six months later. Since the lease had ended and the non-profit owned the machine, I ignored the bills and just threw them away. Then I got a call from Wells Fargo demanding another paymnet of $249, saying the account was never closed and the $249 represented accrued interest. I faxed Wells Fargo all the paperwork and copies of the cancelled checks to prove that the lease had ended and that we owned the machine outright. I even used the very same multifunction machine in question to fax the paperwork back to them.

Wells Fargo insisted that the money was still owed, and continued to send invoices and made threatening phone calls. They finally turned it over to a collection agency, which made more threatening phone calls. Not wishing to harm our credit standing, I asked the board of the non-profit for authorization to pay the bogus bill and they agreed just so we could close the matter.

Then, six months later, we received a refund check from Wells Fargo for $95. Wells Fargo apparently figured out they over-charged us for some reason, but there was no explanation for the refund check nor any detailed accounting of what was being refunded or why. It was just an envelope with a check enclosed.

The board of the non-profit has now passed a resolution that we will never do any business with Wells Fargo ever again, nor will we maintain a bank account with Bank of America or any other bank that accepted TARP funds. My current task as treasurer is to move all our money out of BofA (which has been our bank since the organization was founded in 1974) and into a different bank that has not taken any taxpayer bailout money. Believe it or not, there still are a few around (e.g., Union Bank, USBank, Mechanics Bank and Pacific National Bank are four that we are considering).

Re:Not only act of idiocy

[VGPowerlord]

Referencing both 2001 and Idiocracy?

Re:Not only act of idiocy

[shentino]

I'd be careful about that. Precedents could be established.

Re:Not only act of idiocy

[Reziac]

"Why not just work out some kind of a deal with the occupant?"

As I've heard it, because the tax writeoff (and with those marginal loans, the gov't reimbursement for the loss) far exceeds the salable value of such houses.

Your tax dollars at, uh, work.

Re:Not only act of idiocy

[Reziac]

And don't panic when that old car needs repairs.

On average you'll need to cough up for a major repair about every three years -- but it's still cheaper than making monthly payments.

Realworld example: average major repair on my paid-for truck: $700, once every 3-4 years. Average monthly payment on a newer truck: $400 per month, every month. Gee, which one is more economical??

Re:Not only act of idiocy

[Skye16]

Very true. I did pretty much the precise opposite and now I'm fairly deep underwater in my vehicle. After another 4 years of this, I should be "okay", but I would have been far better off if I had gone the route you mentioned than the one I took. Far better off.

Re:Not only act of idiocy

[Jesus_666]

Houses can end up on the market for surprisingly small amounts. Not too long ago there was a story on TV about a family who got screwed over by the mass bank suicide - the bank they had a mortgage with went belly-up, their mortgage was sold off to another bank and that bank managed to put the house up for auction. In the end the house was auctioned off for some thirty thousand Euros, if I remember correctly - and I think it was a two-family house, which (in Germany) means construction costs of about 200.000 Euros and up, not including the land it was built on. Let's assume 300.000 in total. So we're down to about a tenth of what the house was actually worth.

The GP also pointed out that the house was vandalized within a year foreclosure, which sounds like it wasn't in the best of neighborhoods. If the neighborhood used to be better when the house was built that might have contributed to it losing value.

Re:Not only act of idiocy

[snowgirl]

Actually, for a 30 year mortgage at current interest rates, 1 years payments (if you include PMI and tax payments to an escrow account) would be around 1/10th the cost of the house. I'd be guessing the original poster didn't get the sweetest interest deal either, since it was an "investment" property, and banks tend to consider those higher risks.

It's still a stretch, but in some areas of the country, if you add vandalism to it, it's at least plausible.

One word: Detroit.

Re:Not only act of idiocy

[AK Marc]

Actually, it is the law. Wells Fargo is required by law to sue itself. It must file suit to forclose. It must file suit against all leinholders to clear the title. It can't do it any other way. It can't hire one firm to represent both sides, even if both sides are the same company because that's a conflict of interest, and we are have adversarial court system. And so it's in the interest of both firms to stretch out the legal proceedings to increase billing, again a legal thing. Wells Fargo is caught in the middle of bad laws written by lawyers and enforced by lawyers. And the only way out is to sue themselves. And somehow that's because the government is issuing bailouts? Wells Fargo is one of the most successful in this time. They aren't on the brink of failing, they are one buying up other institutions at fire sale prices. But bad laws and stupid Internet armchair quarterbacks make for good news. And that's what it really is about. Blaming everyone else and pointing out the stupid things, when the real problem is the voters who pick from Kang and Kodos and think there is a difference when all of them spend more than we take in on projects most people don't want. The only difference is what projects that shouldn't exist get funded these 8 years or those 4 years or whatever.

Re:Not only act of idiocy

[AK Marc]

Wells Fargo is required by law to sue the other leinholders in order to clear the title. There is no way, other than court order (which requires a lawsuit) to get a name removed for a clear title. Even when they are the same entity.

Re:Not only act of idiocy

[Anonymous Coward]

I actually work for this company in IT and it does not surprise me one bit. I have to fill out 3 time sheets, 20 pages of paperwork for a production deploy (which goes to 3 different departments for approval), and in general have to document things at least 3 times for departments that have no clue about each other. I spend on average 4hrs or more a day just filling out paperwork to describe work I want to do or explaining to someone why I did what I did. I am now certain that whoever wrote the original story for office space had to have talked to Wells Fargo It employees for ideas.

Re:Not only act of idiocy

[thepyronaut]

USBank is owned by US Bancorp and Security Pacific is owned by Bank of America. US Bancorp and BofA have taken bailout money (according to Wikipedia anyway).

http://en.wikipedia.org/wiki/Troubled_Asset_Relief_Program#Beneficiaries

Re:Not only act of idiocy

[Anonymous Coward]

So they foreclosed on an investment house that you couldn't afford. Boo hoo...

What I actually learned from your post: Wells Fargo was kind enough to let your payments slip by 3 months as long as you paid them interest. They gave you time to make the payments, you never organized your finances such that you could repay them properly, so they foreclosed. How does this story reflect poorly on the bank?

Re:Not only act of idiocy

[iamhassi]

"Something's not adding up in your story."

I completely agree! The whole thing never made sense to me either

"How is it that in 2 years and 3 months, you couldn't come up with the interest on the 3 month's payments?"

I don't recall explaining how Wells Fargo calculated interest, so how would you know if it made sense or not?

" you were refunded 1 year's worth of payments, and that the house was put on the market for 1 year's worth of house payments. I'm going to have to call B.S. on this one."

Like I said, I don't understand it either.

"home went back on the market for 1/30 of its original price is a little much."

wait... what? Do you think they take the value of your house, divide it by 30 years, and that's what they charge you per year? Wow that'd be great, wouldn't it? So a $300,000 house divided by 30 would be 10 grand a year, or a $833/mo payment. Everyone would own million dollar houses.

Re:Not only act of idiocy

[iamhassi]

"Actually, for a 30 year mortgage at current interest rates, 1 years payments (if you include PMI and tax payments to an escrow account) would be around 1/10th the cost of the house. I'd be guessing the original poster didn't get the sweetest interest deal either, since it was an "investment" property, and banks tend to consider those higher risks. It's still a stretch, but in some areas of the country, if you add vandalism to it, it's at least plausible."

Yep, got screwed buying it at the height of the market bubble, and the vandalism was the copper pipes (copper's valuable, or it was) and A/C sitting outside.

Re:Not only act of idiocy

[Cthefuture]

The board of the non-profit has now passed a resolution that we will never do any business with Wells Fargo ever again, nor will we maintain a bank account with Bank of America or any other bank that accepted TARP funds.

Anyone know of a good mortgage company that did not accept bailout funds? Bank of America bought my mortgage company and I want to switch to someone else. I have been looking around but I don't know which companies suck.

Re:Not only act of idiocy

[Anonymous Coward]

I work (as a contractor) for a subsidiary of USBank. They did take the TARP money, but they have either repaid it or have announced that repayment is imminent. I work in a division that doesn't have to care about that, so I don't know any details other than the company making a big deal of it.

Re:Not only act of idiocy

[azgard]

This is bullshit. It's not about stupidity at all, it's about control. People withhold information from other people in order to control them, not because they are stupid.

I recently read the following great book:
http://www.amazon.com/Maverick-Success-Behind-Unusual-Workplace/dp/0446670553/ref=sr_1_1?ie=UTF8&s=books&qid=1247546857&sr=8-1

It shows that if you allow free flow of information (and more democracy and less autocracy), ordinary people (which you denounce by calling them stupid) become much more productive and are able to make much better decisions.

Re:Not only act of idiocy

[Lotana]

Well since they would be using their own internal law firm...

Re:Not only act of idiocy

[lgw]

I banked with WF for a few years. They failed in just about every way it's possible for a bank to fail, repeatedly charging bogus fees (and waiving them each time I'd call and bitch at them) because they couldn't properly link my CDs with my other accounts, losing credit card payments, being unable to understand which state I lived in, ugggh. It still pisses me off to think how incompetant they were in every detail.

Re:Not only act of idiocy

[CubicleView]

You can generally also haggle with the dealer if you pay cash. Depending on the car that could be a saving of 500 - 1000 easy.

Re:Not only act of idiocy

[gtall]

I have a horror story about Bank of America; never get near that bank without a flamethrower or a bazooka. Pa lend out some of his IRA money to various companies. The loans were in his IRA portfolio and kept at Fleet Bank. Fleet got bought by BofA and then the fun started. There was one remaining loan by that time since I had cleaned up the rest. The loan was to a microbrewery and they religiously pay their monthlies on time every month. BofA decided they had a problem with a loan in an IRA and wanted it and the IRA gone. They decided to charge $8K a year on about $64,000 worth of loan to keep it on their books and if I would like, the IRA (now the sole retirement for Ma since Pa went to the Great Food Bowl in the Sky) should be moved to somewhere else, anywhere but BofA. As they well knew, no other IRA keeper would accept an account with a loan in it, so we had to take it out in one large disbursement which caused $16,000 in taxes due to Uncle Sam. Under a typical year, Ma wouldn't pay anything. So thank you BofA from the bottom of my heart where it is cold and thinks wicked thoughts.

Re:Not only act of idiocy

[DarKnyht]

True, but it was enough to apparently motivate them to fix them problem. The Attorney General would have been the next phone call.

I believe in escalating consequences instead of playing all the cards at once.

Re:Not only act of idiocy

[DarKnyht]

Yeah, I am paying my stupid tax currently and this will be the last car purchased this way. I will happily drive a piece of crap to avoid having car payments.

Re:Not only act of idiocy

[SparkleMotion88]

While I agree that driving an old car is the way to go, I don't think avoiding car financing is always wise. A car loan is one of the cheapest types of loans you can get. Let's say you have $20,000 and you want to buy a car that costs $20,000. In a typical market, you could get a loan to pay for the car and invest the cash in a low-risk mutual fund and come out on top.

Re:Not only act of idiocy

[TheQuantumShift]

It's not just them.

About a decade ago I worked at a large credit card company in the HR dept. One day we were discussing budgets and someone mentioned how much of the departments budget was going to be used by paying rent on the office space. I didn't understand as the building was owned by The Company. It was explained to me (as if it was the most logical thing in the world) That Division X "owned" the building, and the HR division (not a revenue generating division) had to use the money received from The Company for total budget (salary, supplies and what not) to pay Division X (a revenue generating division) for the use of "their" office space...

The worst part about it was that I was the only one who saw a problem with this strategy.

Re:Not only act of idiocy

[Anonymous Coward]

Your story intrigues me, and I wish to subscribe to your newsletter.

Re:Not only act of idiocy

[radtea]

This is bullshit. It's not about stupidity at all, it's about control.

Never assume venality where stupidity will do. I agree that even stupid people can do better with a more free flow of information. But most people do not take the many simple and effective steps that are available to increase information flow, and frequently acquiesce to restrictions on information flow for bogus reasons. This demonstrates empirically that they are stupid.

And as I said in the GP, people who are both evil and stupid take advantage of this by using information flow restrictions to control others.

Re:Not only act of idiocy

[Pranadevil2k]

Most phone operators are instructed to end and immediately forward a call to a supervisor the moment you ever mention lawyers or legal action. This isn't necessarily a good thing, especially when you're talking to a company that is run almost entirely by lawyers.

Re:Not only act of idiocy

[azgard]

I am not necessary assuming venality - they may very well withhold information out of fear of reprisal of someone who holds power over them. I would even say this is by far the most common reason, and yet, the root there is power, not stupidity.

Re:Not only act of idiocy

[boss_hog]

Even if it's not 1/30, your math still seems suspect.

I have a 200k mortgage note on my home. I bought it early in 2004, so let's assume it's not overvalued too badly(not quite as bad as those 2007, 2008 mortgages). My monthly payment, with PMI, taxes, etc: 1700$. (thank you FHA first-time home-buyer plan)

1 year's mortgage payments: 20,400$.

that's still 1/10 the price, even lower if we didn't figure in PMI, taxes, etc. For a home that had only been in foreclosure 1 year, that still seems way higher (or lower) than the typical 30-50% discounts I hear foreclosures are going for these days.

Re:Not only act of idiocy

[Anonymous Coward]

you're defending a company that's suing itself, remember? And like someone already said it was a investment so rates were high and you got a cheap FHA. Figure high rates in and your math is accurate.

crazy?

[pak9rabid]

Under normal circumstances I'd say this is completely wacked...but in legal land I guess it's just business as usual.

Suing yourself is collusive litigation.

[MarkvW]

Suing yourself is collusive litigation. We pay taxes to support the legal system and it is outrageous for a corporation to abuse the already overburdened judicial system resolving disputes that are not really disputes.

There must be more to this story, though. Maybe it's Wells Fargo Holding Co., Inc. versus Wells Fargo Partners, Inc. That would make sense.

Re:Suing yourself is collusive litigation.

[David Gerard]

Per TFA, apparently not - it's the same corporate entities on both sides.

Re:Suing yourself is collusive litigation.

[Anonymusing]

From the article: ...court documents clearly label "Wells Fargo Bank NA" as the plaintiff and "Wells Fargo Bank NA" as a defendant.

Aren't they supposed to spontaneously self-destruct when this happens?

Re:Suing yourself is collusive litigation.

[wickerprints]

It's even worse that that--taxpayer money was given to Wells Fargo as part of the bailout, so in essence they are paying lawyers on both sides with public money and wasting public money by litigating against itself. I don't think there's any more to the story, except perhaps that the sudden discovery that every employee in their legal department has simultaneously and collectively found a way to shove their cranium into their rectum should have been equally as newsworthy, if not publishable in a scientific journal.

Re:Suing yourself is collusive litigation.

[gd2shoe]

I'm surprised the Judge hasn't called in both attorneys and chewed them out. They clearly deserve it.

Re:Suing yourself is collusive litigation.

[sargon666777]

Thats true, but they should have to pay court costs and so forth which should help absorb some of the impact to the tax payers. The really amazing part is the two law firms that are going to make a decent amount suing each other while representing the same client.

Re:Suing yourself is collusive litigation.

[cbiltcliffe]

The judge is probably a Monty Python fan, and he's going to let the whole trial go through.

Then, at the end, he's going to say:

"I'm ruling against Wells Fargo, and in favour of Wells Fargo."

Then, promptly get up from the bench, and return to his chamber, all the while laughing at the sound of lawyer's heads exploding in the courtroom.

Re:Suing yourself is collusive litigation.

[roc97007]

> Aren't they supposed to spontaneously self-destruct when this happens?

Oh, if only.

Re:Suing yourself is collusive litigation.

[rhsanborn]

Not given, lent. Wells fargo will pay that money back in full. Other banks may not, but the taxpayer isn't paying wells fargo to do this any more than a mortgage holder is paying a person to buy a house. Quite the opposite in fact.

Re:Suing yourself is collusive litigation.

[Midnight Thunder]

Aren't they supposed to spontaneously self-destruct when this happens?

You are talking about the legal system and this is known to stand outside the normal laws of physics. ;)

Re:Suing yourself is collusive litigation.

[rodrigoandrade]

> There must be more to this story, though. Maybe it's Wells Fargo Holding Co., Inc. versus Wells Fargo Partners, Inc. That would make sense.

True, but would that headline generate as many pageviews??

Re:Suing yourself is collusive litigation.

[Anonymous Coward]

Thats true, but they should have to pay court costs and so forth which should help absorb some of the impact to the tax payers. The really amazing part is the two law firms that are going to make a decent amount suing each other while representing the same client.

Does that client enjoy attorney-client privilege? Good luck providing it to them! Maybe when this is over EVERYONE involved will be sued...

Re:Suing yourself is collusive litigation.

[He who knows]

Aren't they supposed to spontaneously self-destruct when this happens?

no the company will simply get replaced by something even more complicated.

Re:Suing yourself is collusive litigation.

[JTsyo]

Are there no others that hold the second loan?

Re:Suing yourself is collusive litigation.

[T Murphy]

I knew the founding fathers missed something in the Constitution...

Re:Suing yourself is collusive litigation.

[tnk1]

"To make this easier, the Court has decided to give code names to the two sides in the litigation. Let the record show that the Plaintiff, Wells Fargo Bank NA, will henceforth be known as Fucktard, and the Defendant, Wells Fargo NA, will be known as Asshat. The counselors are instructed to refer to their clients by the names given by the Court in order to clarify the record. Failure to do so will result in a contempt citation.

Please proceed with your opening arguments, Fucktard."

Re:Suing yourself is collusive litigation.

[McGruber]

There must be more to this story, though.

There will be, when the defendant files a countersuit.

Re:Suing yourself is collusive litigation.

[bazorg]

tnk1 for president! :D

Re:Suing yourself is collusive litigation.

[Jaysyn]

Loaned. Lent is a religious observance.

Re:Suing yourself is collusive litigation.

[timeOday]

Sure, there's probably some legalistic reason why this happened. But the question becomes, why and in what sense are they a single company at all? Put another way, what are the upper N levels of management being paid for?

Re:Suing yourself is collusive litigation.

[Chris Burke]

Not given, lent. Wells fargo will pay that money back in full. Other banks may not, but the taxpayer isn't paying wells fargo to do this any more than a mortgage holder is paying a person to buy a house. Quite the opposite in fact.

So, if I understand you, Wells Fargo has given up bailout money in the days before Passover?

Re:Suing yourself is collusive litigation.

[MooUK]

Oh, hell yes.

Re:Suing yourself is collusive litigation.

[DragonWriter]

I'm surprised the Judge hasn't called in both attorneys and chewed them out. They clearly deserve it.

Really, I think the attorneys for the other defendants should be able to make enough of a hash out of Wells for this, since anything Wells files as a defendant that contradicts what Wells files as a plaintiff should be usable as evidence -- and admission from Wells, even -- not only of the falsity of the claims Wells is making as plaintiff but also of Wells' own knowledge that the claims are false and without merit.

Re:Suing yourself is collusive litigation.

[Anonymous Coward]

It's also the past tense of "lend", which is much more commonly used in British English than "loan". If you're going to be an ass, at least be a correct ass.

Re:Suing yourself is collusive litigation.

[kushiague]

Thank you sir for making me spit out my coffee in laughter, i hope to some day repay you in kind.
Cheers!

Re:Suing yourself is collusive litigation.

[xednieht]

Knowing Wells Fargo it's probably the same attorney with multiple personality disorder.... Do I know you? Didn't we play golf once? hehe

Re:Suing yourself is collusive litigation.

[AK Marc]

There must be more to this story, though.

They must get a court order to clear the title. The only way to get a court order is to go to court. Since they are the primary and secondary lein holders, they must sue themselves or they can't ever sell the property they forclosed on. It's required by law, not a frivilous lawsuit. That they are putting up a fight is a symptom of our adversarial law system and that they are required to hire different firms to represent each side, as to not do so would violate what little ethics lawyers claim to have. And so each firm is representing their side (even if they are the same side) to the best of their ability, as required by ethics (and essentially, the law as well).

Re:Suing yourself is collusive litigation.

[hackingbear]

At least from the story we were told, WFC didn't want to take the money but Treasure forcd them to take it. The plan of treasure was to flood all banks, good or bad, with lots of cash, and so we couldn't tell the good ones from the bad and so we wouldn't all withdraw meoney from a perceived bad bank and cause another major bank-run.

Re:Suing yourself is collusive litigation.

[Anonymous Coward]

Loaned? Hahahaha.

Seriously, banks that are *insolvent* have been given bucket loads of cash. Accounting rules have been changed so they can lie on their balance sheets and pretend they still have huge assets they can sell. Do you really think taxpayers will get all their money back? Did we get the money back the last time something like this happened?

Okay, I'm officially impressed.

[mmell]

How do I get a job there?

Re:Okay, I'm officially impressed.

[ivan256]

For a good start, graduate law school with a 2.00 GPA.

It's a wash.

[Queltor]

Wells Fargo better make sure the loser reimburses the winner's legal expenses!

Re:It's a wash.

[kimvette]

I don't know about you, but I am rooting for Wells Fargo Bank NA in this case!!

Re:It's a wash.

[Anonymous Coward]

You must be new here.

Re:It's a wash.

[MightyMartian]

Don't blame me. I voted for Kodos!

Since the lawsuit was filed in Florida ...

[Hotawa Hawk-eye]

why not increase the strangeness and have Wells Fargo hire Jack Thompson to represent one of the sides?

...

...

Oh, right.

Re:Since the lawsuit was filed in Florida ...

[MyLongNickName]

Why not hire him for both sides and let him have the experience of actually winning a case?

Re:Since the lawsuit was filed in Florida ...

[SCPRedMage]

No, but now I have the mental image of Jack Bauer beating the crap out of Jack Thompson.

That really made my day...

Re:Since the lawsuit was filed in Florida ...

[autocracy]

You didn't stop to think of the following decade where we'd have to hear that Bauer played too much GTA?

Re:Since the lawsuit was filed in Florida ...

[Anonymous Coward]

You're hiding a murder simulator between those ears?

Re:Since the lawsuit was filed in Florida ...

[Anonymous Coward]

He'd be the only one who could pull off making the case even more strange by causing both sides to lose.

Re:Since the lawsuit was filed in Florida ...

[Anonymous Coward]

I'm pretty sure he would still lose to himself

Re:Since the lawsuit was filed in Florida ...

[SCPRedMage]

You didn't stop to get the mental image of Bauer jumping into frame and reiterating the beat-down every time Thompson brings it up?

Too many lawyers

[Anonymous Coward]

I must come to the inescapable concludsion that there are too many lawyers in the U.S.

Re:Too many lawyers

[cbiltcliffe]

Yeah...maybe it's a bailout project to make work for all the unemployed lawyers.....

Re:Too many lawyers

[Anonymous Coward]

How can you possibly think that? If the U.S. had fewer lawyers, there wouldn't be enough of them out there to represent every corporation on both sides of lawsuits like this. Then Wells Fargo would be left unrepresented in this case, and would just be beat down by the Wells Fargo lawyers on the other side. The problem is that there are too few lawyers - if we had just one more lawyer, he could act as a mediator to help Wells Fargo and Wells Fargo resolve this little dispute without getting the courts involved.

Coke did this

[travdaddy]

I remember a similar case when Coke sued Coke Zero. It was all over TV a couple years ago.

Re:Coke did this

[deanoaz]

Except that was a humorous Coke Zero ad campaign about how utterly stupid it would be if Coke sued itself. Wells Fargo is actually doing it.

Re:Coke did this

[SomeJoel]

You know, the joke was funny enough without you having to explain it.

Re:Coke did this

[Todd Fisher]

Woosh!

Re:Coke did this

[Anonymous Coward]

Except that was a humorous Coke Zero ad campaign about how utterly stupid it would be if Coke sued itself. Wells Fargo is actually doing it.

You know, the joke was funny enough without you having to explain it.

Some of us don't have a TV you insensitive clod!

Re:Coke did this

[Slashdot Suxxors]

Your username is oddly appropriate for this article.

Re:Coke did this

[aj50]

No it wasn't, I didn't understand it at all.

Then again, I wouldn't have seen the explanation if it wasn't for your comment saying how redundant it was.

So thank you.

Re:Coke did this

[Anonymous Coward]

I think you replied to the wrong guy.

Re:Coke did this

[Anonymous Coward]

Think of us, the non-americans, we did not know about that and nobody offered a youtube link to enlighten us ...

Re:Coke did this

[Anonymous Coward]

Hey I haven't owned a TV set since the late 90s, I don't even watch TV on the net. The parents post was quite informative for the many good folks like me. ( I actually thought that it was true for a moment :)

Why Hire Another Lawyer?

[Greyfox]

They could save a crap ton of money if they used the same guy to both prosecute and defend the case!

Re:Why Hire Another Lawyer?

[Anonymous Coward]

Posting as anonymous coward here. I love your comment and idea. Please Wells Fargo, in these dark days accept this suggestion to save money and entertain us all. Now it's a Marx Brothers Comedy.

Re:Why Hire Another Lawyer?

[Anonymous Coward]

Unlike the court case, THAT would just be silly.

Re:Why Hire Another Lawyer?

[LaminatorX]

Conflict of interest.

Re:Why Hire Another Lawyer?

[Anonymous Coward]

Actually not, he'll just bill the double amount of hours.

Re:Why Hire Another Lawyer?

[Keyper7]

Yep, there's a certain guy who'd be perfect for this job....

Re:Why Hire Another Lawyer?

[ItsJustAPseudonym]

Stephen Colbert could do it! You know that skit that he occasionally does, in which he uses two camera angles to argue points and counterpoints with himself? Awesome!

As a customer of Wells Fargo...

[Banichi]

...trying to get a loan modification so I can keep my house, I must say that this fits with the general level of inanity I've observed from these yahoos.

Oblig.

[Anonymous Coward]

Step 1: Sue self.
Step 2: ???
Step 3: Profit!!!

Re:Oblig.

[Tolkien]

Step 1: Sue self.
Step 2: ???
Step 3: ???
Step 4: Profit!!!

You missed a step.

Re:Oblig.

[johnny0099]

Step 1: Sue self.

Step 2: ???

Step 3: ???

Step 4: Profit!!!

Step 5: Rinse. Repeat.

You missed a step.

You missed a step.

Feedback loops...

[Anonymous Coward]

Did anyone really think the banking industry was immune to one of prime forces of human nature?

There just doesn't seem to be an end to the stupidity that plagues the money farm....

To quote a simpler solution, "Jump You Fuckers!"

Re:Feedback loops...

[Anonymous Coward]

Feedback loops..

Somebody reformulate the circuit theory for the banking industry! We need financial resistors and capasitors, O Captain! Quickly, before it's too late, my Captain!
Here Banking Industry! dear financier!
  This arm of subsidies beneath your head;
    It is some dream that on the markets,
      You've fallen cold and dead.
--
Apologies to the ghost of Walt Whitman

Schrodinger's Bank

[XiX36]

They will exist in both a state of winning and losing this case regardless of the outcome. Cool! I would ask why this stupidity is allowed to continue but then I remember that people like this thought credit default swaps were a pretty neat idea. . .

Re:Schrodinger's Bank

[Landshark17]

With the added benefit that at tax time they can report huge financial losses resulting from losing the lawsuit, while simultaneously report to their stockholders on their windfall from winning the lawsuit.

Re:Schrodinger's Bank

[Culture20]

Message to all other creditors of Wells Fargo: "Sorry, we owe this money to our #1 creditor, Wells Fargo, due to the outcome of this lawsuit. You can't have any."

Re:Schrodinger's Bank

[Anonymous Coward]

They will exist in both a state of winning and losing this case regardless of the outcome. Cool! I would ask why this stupidity is allowed to continue but then I remember that people like this thought credit default swaps were a pretty neat idea. . .

So we put the president of Wells Fargo in a box with a loaded gun........

Re:Schrodinger's Bank

[bored]

I would ask why this stupidity is allowed to continue but then I remember that people like this thought credit default swaps were a pretty neat idea.

Fundamentally, CDS's are a fairly good idea (aka protect the lender if the borrower defaults, see Private Mortgage Insurance). The problem is that its hard enough to price something like PMI. Its even harder to price a CDO, and given the abstractions, people started to play games, like buying CDS's for securities they didn't even own, from multiple companies. Or selling CDS's at effectively random prices..

I spent 5 minutes

[Blixinator]

Trying to figure out what an Idle article was doing in YRO.

Florida requires it?!

[bidule]

I RTFA, and it appears that Florida requires that you sue all lien holders. Since they have 80/20 double mortgage, they have to sue themselves.

Re:Florida requires it?!

[jfengel]

Thanks for RTFA. I find that most of the time stories about "How incredibly stupid is this?" are often leaving out some crucial fact.

Re:Florida requires it?!

[Anonymous Coward]

Even with that crucial fact it's still incredibly stupid.

Re:Florida requires it?!

[Manfre]

Regardless of facts being left out, the company is still suing itself, which is arguably stupid.

Re:Florida requires it?!

[hondo77]

Since they have 80/20 double mortgage, they have to sue themselves.

Which would be fine except that, as defendants, they are denying their own (plaintiff's) claims. That's the idiocy part.

Re:Florida requires it?!

[tmosley]

No, they have to INFORM all lienholders.

Just be glad I'm not Wells Fargo, or this would have counted as notice.

Re:Florida requires it?!

[amicusNYCL]

Regardless of facts being left out, the company is still suing itself, which is demonstrably stupid.

Re:Florida requires it?!

[gurps_npc]

That would make sense ... if their second set of lawyers admitted defeat and settle. But having a second set of lawyers actually deny claims of the first/defend the company makes ZERO sense.

Re:Florida requires it?!

[He who knows]

yeah but this is an idle story and a funny one for that.

Re:Florida requires it?!

[BradleyAndersen]

While it may seem stupid (and I agree with you, it does), it is apparently necessary for the particular suit to go forward, as GGP says. Usually, I would say this means the law needs to be changed; however, this law actually makes sense. This just happens to be a really strange application of that law.

Re:Florida requires it?!

[ILuvRamen]

well they could just retitle it "how stupid are florida laws?" and rephrase the summary and it would basically be the same thing. Actually it could have said "Florida requires Wells Fargo to sue itself"
Either way this is idiotic and um...I hope Wells Fargo loses lol.

Re:Florida requires it?!

[amicusNYCL]

I don't buy it, I think it's just stupid. There's no good reason for any entity to sue itself, it's a waste of resources. You might as well just settle out of court with yourself, right? This is just a way for the lawyers to make money, with no real work being done that couldn't have been done without filing a lawsuit. I especially like this statement:

"Defendant admits that it is the owner and holder of a mortgage encumbering the subject real property," the answer reads. "All other allegations of the complaint are denied."

I love how the defendant (Wells Fargo) is denying the allegations made by the plaintiff (Wells Fargo). If they were just going to deny them, why did they bother making the allegations in the first place? This isn't Wells Fargo vs. Wells Fargo, it's one law firm vs. another, where both of them win because both of them get paid. If the law has this requirement for something to become valid, then obviously it's a stupid law for not having a loophole where if all loans are held by the same lender, you don't need to sue yourself. The only reason I could see that this would make sense is if there were additional lenders involved, e.g. if Wells had the first and second mortgages, and other lenders had a third or fourth mortgage. The article only talks about the two held by Wells, so it sounds like Wells is suing itself for no reason. It just seems really stupid. And taxpayers are paying to keep these people in business, because obviously they're so good at it.

Re:Florida requires it?!

[Anonymous Coward]

Big corporations are idiotic. We sell real estate related data and have two departments at one bank (not Wells Fargo) buy the same data. Its public record, so its not like they couldn't just share it.

Re:Florida requires it?!

[diamondsw]

And required by Florida law. If they did not, the foreclosure would be vacated.

As usual, it all comes back to Florida.

Re:Florida requires it?!

[Abcd1234]

I RTFA, and it appears that Florida requires that you sue all lien holders.

Wrong. From the article:

"Due to state foreclosure laws, lenders are obligated to name and notify subordinate lien holders," said Wells Fargo spokesman Kevin Waetke.'

(emphasis mine)

Since they have 80/20 double mortgage, they have to sue themselves.

Also wrong. From the article:

Rather than suing itself -- a stunt that was never even attempted on the MTV show "Jackass" -- wouldn't it be easier for Wells Fargo to release one of the liens to itself? Or pursue some other internal accounting strategy rather than tie up the court with nonsense?

Re:Florida requires it?!

[vlm]

Regardless of facts being left out, the company is still suing itself, which is demonstrably stupid.

No no no. The demonstrably stupid part is not suing itself, but the same org taking both sides of the 80/20.

The whole point of an 80/20 is the bank paying for the 80 thinks the victim is too much of a credit risk for a 95/5 or a 100/0 or whatever, but maybe they can get a 20 somewhere else, from some loan shark or something.

Basically some fool paid all the fees for two mortgages at the same place, an 80 and a 20, when they should have just paid one fee for a 100/0. Its really more of a fraud case than anything else.

The application of the law seems weird because its a being applied to a bizarre situation.

Admittedly my last home purchase was before the housing bubble, with at least 20% down, a long time ago. Maybe in the bubble madness this is just how things were done.

Re:Florida requires it?!

[Anonymous Coward]

except of course, for the fact that they had no other choice, otherwise they'd be in violation of Florida Law, and more than likely, they'd end up with somebody arguing that "hey, you left these guys out! It's their fault" so instead of having that complexity, they're putting all their ducks in a row in the first place.

Re:Florida requires it?!

[Burning1]

I once wrote a program that got stuck in a endless loop. Is the program demonstrably stupid?

Law is sometimes like code, in that it can create unexpected and unintended behaviors when executed literally. It's not stupid, IMO... It's a sign that we need better law.

Re:Florida requires it?!

[DragonWriter]

Regardless of facts being left out, the company is still suing itself, which is arguably stupid.

No, there are many cases in law when to sue certain people, you must sue everyone similarly situated, or at least everyone similarly situated that can be brought before the court. This will naturally lead to certain cases where the plaintiff is required to sue themselves.

What is stupid, OTOH, is contesting the claims you make as plantiff in your own filings as a necessary (but clearly not genuinely opposed) defendant.

Re:Florida requires it?!

[vlm]

Which would be fine except that, as defendants, they are denying their own (plaintiff's) claims. That's the idiocy part.

They promised the guys they sold the CDO to that they would defend their investment. It's probably going to get wiped out (tough luck suckers!). They have a minimum legal obligation to try to fight for the invested money.

Its probably much cheaper to treat them(selves) like any other plaintiff and fight back, rather than get the 3rd party CDO guys tee-d off and have the CDO guys sue the "defendant WF" for not trying to protect their investment (from themselves).

WF is in an excellent position to do all kinds of corrupt things by being on both sides of the 80/20. This is an in your face way of forcing the judge to get involved to prove they are not doing anything bad. Much cheaper to do it all above board w/ the judge's oversight today, than fight a lawsuit with the CDO holders next month whom claim WF was doing sneaky stuff since they owned both sides of the 80/20.

Its easy for one corporation to do something corrupt if they buy into both sides of the deal. But if they involve a neutral third party judge, they are less likely to do something corrupt. Thats not "idiocy", thats "good law".

Re:Florida requires it?!

[Artifakt]

I could see Wells Fargo being forced into complying with the State of Florida's legal requirement. I'm sure this explanation appeals to some people who want to believe that it's always governments and not corporations that act stupid and crazy. But why have your defense deny the other allegations? Why not file a motion, have the other department agree with all points and settle out of court, so the company as a whole can get on with what it needs to do. Whatever law Wells Fargo blames this on, there certainly isn't a law that requires litigants to disagree with claims and insist on going through the entire trial process. I will flat guarantee you no state has a law saying litigants can't settle out of court. Still, it makes a superficially good story when you are caught being idiots.

Re:Florida requires it?!

[Anonymous Coward]

What is stupid, OTOH, is contesting the claims you make as plantiff in your own filings as a necessary (but clearly not genuinely opposed) defendant.

Exactly! The moronic part is that they are paying legal fees to two different lawfirms to work this case, when they really only have to have file the case and then settle it with themselves.

Re:Florida requires it?!

[Anonymous Coward]

ok, all you paragons of rationality, but then logically explain why they paid money to hire a lawyer to obstruct their own court case..

Re:Florida requires it?!

[JasonTik]

As opposed to all other lien holders. Well, that's Florida's fault. Who wants to move to Florida and have some fun?

Re:Florida requires it?!

[Estanislao Mart�nez]

Why not file a motion, have the other department agree with all points and settle out of court, so the company as a whole can get on with what it needs to do.

The whole company is one party in the eyes of the law; two deparments of the same company are not. For this reason, two departments of the same corporation cannot "settle out of court"; they can't have a legal dispute between them to start with.

The sane thing to do is for WFC to file its complaint as plaintiff, and to note in it that WFC is both a primary and secondary lien holder. It cannot file a complaint against itself because it cannot have a controversy against itself. When it comes to the requirement that all secondary lien holders be notified about the action, well, WFC cannot represent to the court that it was not informed about the complaint that might dismiss its secondary lien, because the complaint was filed by WFC itself.

Re:Florida requires it?!

[jeffasselin]

Exactly. It's funny that they are suing themselves, but it's absurd that they are DEFENDING themselves. Against themselves.

Re:Florida requires it?!

[mattwarden]

I didn't RTFA and I immediately knew this was a logical reaction to completely illogical bureaucracy. What's ridiculous is that I had to go 3/4 down the comment page in order to find the first person pointing this out in a comment! Oh, Slashdot...

Re:Florida requires it?!

[sjames]

Up to that point, Fargo's actions make sense in a crazy legal landscape. However, then, they have for the record denied their own allegations! They're not just going through the motions, the left fist and right fist are punching the face. A suit doesn't have to be contested. If they really wanted to be smart, they could have failed to answer themselves and so won by default. Or they could immediatly move to settle or request summary judgment.

Then they can put out a press release that the state of Florida is too stupid to live.

Re:Florida requires it?!

[Mindcontrolled]

Law is sometimes like code, in that it can create unexpected and unintended behaviors when executed literally. It's not stupid, IMO... It's a sign that we need better law.

Good analogy, from the perspective of a geek working in patent law at the moment. And as in every coding project with an insane amount of LOC, law won't ever be bug-free. We need a better law in the sense that it has to provide graceful exception handling in case a bug is encountered.

Re:Florida requires it?!

[hackingbear]

Very likely, the two original loans were made by different banks; the smaller one by Wachovia. As WFC bought Wacho, the loan went into WFC's portfolio

Re:Florida requires it?!

[Anonymous Coward]

Actually, My mortgage is an 80/20 by the same company... The reasoning I was given is that with First Time home buyers programs the Housing Authority will require either at least 10% down or will do an 80/20 loan for you. I'm sure of the full background as to why ... but that is how it worked for me...

Are they pessimists or optimists?

[K. S. Kyosuke]

That's an important question: Whether it's a win-win scenario or a lose-lose scenario for them depends on it.

On a serious note

[Anonymous Coward]

If this is the clinical view banks take when foreclosing against themselves what hope is there for the common man.

And the winner is...

[freejung]

The lawyers!

It actually makes a perverse kind of sense though. Banks can effectively lend money to themselves, so they should be able to sue themselves too!

Lewis Black

[Anonymous Coward]

Hmmm... do we have a replacement for the Starbucks across from the Starbucks?

Eh

[BSDevil]

It's actually more common than you'd think. The meat of the story is really this line:

As holder of the first, Wells Fargo is suing all other lien holders, including the holder of the second, which is itself.

Wells Fargo (holder of the senior mortgage) is trying to clear out all the subsidiary mortgage interests so that it can sell the property. In the process of doing so, it has to sue itself for record-keeping purposes - if I'm going to buy some property, I want a clear case record showing that all existing claims have been discharged. What will likely happen, however, is that junior Wells Fargo will settle with senior Wells Fargo, after doing some filings to show that it's done it's due dilligence in trying to protect it's fiduciary interest in the property.

Re:Eh

[evilkasper]

That actually makes sense.

Re:Eh

[castironpigeon]

It's not Wells Fargo we ought to be upset at, it's the legal system that's so borked it requires a company to sue itself. Can we burn the law books yet and just govern ourselves by common sense?

Re:Eh

[residieu]

Except the defense is DISPUTING the claims of the plaintiff. If it was just for bookkeeping purposes, wouldn't the defense nod their heads, and rubber stamp a settlement?

Re:Eh

[nomadic]

It's not Wells Fargo we ought to be upset at, it's the legal system that's so borked it requires a company to sue itself. Can we burn the law books yet and just govern ourselves by common sense?

If you want civilization to collapse, sure. Burn all those books and when a bank forecloses on you, they don't file a legal action but send a bunch of guys with baseball bats to throw you out of your house.

Re:Eh

[Todd Knarr]

They could, except that then other lienholders could scream "Preferential treatment!" and delay things or force Wells Fargo to give them preferential treatment too. Remember that if WF succeeds in this action, all those other subsidiary lienholders will end up holding worthless paper, and WF doesn't want to give them anything they can use against WF. If WF treats itself exactly the way it treats the others and follows exactly the same procedures, that takes away one thing those other lienholders can use to try and derail the proceeding.

Re:Eh

[hackingbear]

Yeah, but that just passes the stupidity to our legal system, according to The Law of Conservation of Stupidity.

Re:Eh

[Joe Snipe]

Unless WElls Fargo appeals the case.

Re:Eh

[Anonymous Coward]

I wouldn't hold your breath. I hear that Wells Fargo is being totally unreasonable and making it impossible to settle this lawsuit out of court. They just can't find any points of agreement at all.

Re:Eh

[Holi]

What part of human history suggests we are capable of governing ourselves with common sense.

Re:Eh

[Maximum Prophet]

They want a clear case record, but there's always some random chance involved in law. What if they lose? (Aren't all lawyers, as officers of the court, required to try to win their case?

Re:Eh

[bertoelcon]

What part of human history suggests we are capable of governing ourselves with common sense.

Hunter-Gatherer social structures?

Re:Eh

[vlm]

It's not Wells Fargo we ought to be upset at, it's the legal system that's so borked it requires a company to sue itself. Can we burn the law books yet and just govern ourselves by common sense?

Not a system problem at all.

How can all these "computer people" not know the phrase "garbage in, garbage out".

One bank on both sides of a 80/20 is garbage.

Garbage in, garbage out, therefore the cleanup is inherently going to be crazy.

Re:Eh

[Artifakt]

The whole point of 80/20's and such is to offload some of the risk on a questionable loan. When WF covered its own bet because it had doubts about that same deal unless somebody covered part of the risk, common sense went out the window right there. Expecting the law to work well in such a case is expecting the impossible, like demanding justice be tempered with mercy for the man who shot his parents, because he's an orphan.

Re:Eh

[Bourbonium]

As is becoming more common with foreclosure cases these days, a homeowner can fight the action if they can have the bank prove that they hold the note and all the paperwork on the property. In many, many cases, the bank may well have bundled the mortgage into a security with dozens or even hundreds of other mortgages and sold it to another entity. That entity may well have sold it in a different bundled security to another bank and so on and on and on. I do recall reading about a case in, yes, Florida, where a homeowner has actually forced the bank to re-negotiate her mortgage because they have not been able to prove that they hold her mortgage! They sold it off years ago in such a deal, but now cannot trace the labyrinth of transactions to find the original promissory note, because it has been sold and re-sold multiple times since then.

Re:Eh

[sjames]

How? The defendant caved at the first sight of the plaintiff. The non preferential thing for Fargo the plaintiff to do would be to similarly threaten them until they cave too!

Re:Eh

[Holi]

No, in-fighting happened all the time, murders and bullying were rampant. Think of what we see now on a smaller scale. It works, it's just not efficient and it wastes valuable resources.

Stupidity countdown

[bperkins]

By my count, the bank is only the fifth stupidest here.
Let's count it down:

5) Wells Fargo

For getting itself in the position of having to sue itself

4) Florida State government

For writing a law that requires a bank to sue itself.

3) Al Lewis/Fox News

For writing/publishing this worthless article.

2) samzenpus

For posting this on slashdot.

1) Me

For commenting on this crap.

But if it makes you feel better, go ahead and pile scorn on the banks.

It'll take your mind off the fact that you're the real sucker.

Re:Stupidity countdown

[wizardforce]

How is this a worthless article if it points out the stupidity of certain laws?

Re:Stupidity countdown

[Repossessed]

You forgot the current homeowner, who was dumb enough to do business with Wells Fargo.

Re:Stupidity countdown

[DrMaurer]

Why am I the sucker? You replied to the article.

Wait...crap.

Re:Stupidity countdown

[Estanislao Mart�nez]

4) Florida State government: For writing a law that requires a bank to sue itself.

I actually don't think that the law requires the bank to sue itself, given that, um, the courts simply don't allow anybody to sue themselves. A lawsuit is a process to settle a dispute between two parties. A party can't have a dispute with itself, period, because by definition it has the same interests as itself.

Re:Stupidity countdown

[vlm]

A party can't have a dispute with itself, period, because by definition it has the same interests as itself.

Except in this case it bought into both sides of an 80/20 mortgage, in which case it intentionally set itself in conflict with itself, during the inevitable foreclosure, one of the investments will lose the lawsuit to the other investment.

Re:Stupidity countdown

[frank_adrian314159]

... the current homeowner, who was dumb enough to do business with Wells Fargo.

The homeowner probably didn't have a choice in the matter. In those days when banks were still writing mortgages, the bank sold them to a third party (like Wells Fargo) as soon as they were written. The mortgages often changed hands 2-3 times before they reached their final resting place at the base of a CDO. This is without the chance of one or more of the mortgage holders being bought by an avaricious suitor (like Wells Fargo). In none of these cases would the homeowner have any idea that the mortgage was in the hands of Wells Fargo until it swallowed the mortgage. And, in reality, there's not much the homeowner could do about it after the fact, except refinance. And even that wouldn't stop the same thing from happening again.

Re:Stupidity countdown

[nickrout]

Yep those who read TFA AND the comments will realise that its the law that requires WF to name itself as a defendant (which is not the same as suing yourself). And you rightly identify that the real stupidity was lending too much. Thats the real story. I had a bank manager ring me the other day about a client's contract to buy a house. She said "My god these people seem to have signed a contract that isn't subject to gettiong bank finance approval, why would someone do such a thing?" My response: "Because for the last 3 to 5 years everyone in the market is used to the banks saying 'yes' to every damn thing!"

Re:Stupidity countdown

[Estanislao Mart�nez]

Except in this case it bought into both sides of an 80/20 mortgage, in which case it intentionally set itself in conflict with itself, during the inevitable foreclosure, one of the investments will lose the lawsuit to the other investment.

No, the bank isn't in conflict with itself. It just has two separate claims on the same collateral, one senior to the other. The bank should get its senior claim settled ahead of the junior claims; then the scraps that remain (if any) are adjudicated among junior claims, one of which belongs to the bank itself. So if the the senior debt is for $300,000, the junior debt is five liens for $20,000 each, and the collateral is worth $350,000, the solution is the following:

• The senior creditor gets $300,000.
• The remaining $50,000 is split among the five remaining junior creditors. Each gets $10,000.

In this case, it just so happens that one of the junior creditors is also the senior creditor. So that party gets $310,000.

Re:Stupidity countdown

[Jedi Alec]

4) Florida State government

For writing a law that requires a bank to sue itself.

For some reason the most important part keeps falling off these lists...

0) The good people of Florida, for electing the kind of people that form said government.

That'll be all folks, keep blaming the boogeyman!

The Wells Fargo paradox

[Anonymous Coward]

replaces the Barbers paradox

Get in line

[Jeremy Erwin]

Seems like a clear case of "heads, we win, tails, you lose". This lawsuit ensures that one part of wells fargo gets the proceeds of any auction or resale, and what's left over after satisfying the original note (yeah right)/ will still go to the other part of wells fargo. Maybe the 80% note is subordinate to the 20% note?

Re:Get in line

[sampson7]

Other way around. The 20 percent note is subordinate to the 80 percent. 80/20 mortgages were a common method of getting around lending restrictions. Generally, the 80 percent majority first lien is senior, and then 20 percent remaining amount (in old days, this would have been the downpayment) was also financed at a significantly higher rate. Welcome to 2006.

Crazy like a fox

[russotto]

From another article on the same subject http://www.doomers.us/forum2/index.php?action=printpage;topic=48933.0

Attorney McKillop explains that to avoid suing itself a lender would typically release the lien against the property after the foreclosure goes through. By suing itself, the company avoids the step of having to file that additional paperwork. That, in effect, speeds up the time it takes to sell the property after foreclosing.

(McKillop represents the real defendant, the homeowner).

Seems like this is just a procedural trick to get the second lien dismissed during the original foreclosure case. Apparently Wells Fargo thinks it's worth paying an extra lawyer rather than having to wait for the voluntary release of the lien to go through. Pretty silly, but it is _Florida_ law at issue, after all...

Re:Crazy like a fox

[HeronBlademaster]

But why would the defense lawyer deny the claims? If it was just a procedural trick, wouldn't they just rubber-stamp it through? Or does the procedural trick require denying the claims?

IANAL, but does anyone else have any ideas?

Re:Crazy like a fox

[Anonymous Coward]

WF is claiming insanity. The case won't be discharged as only a sane person would claim insanity.

Re:Crazy like a fox

[BobMcD]

Probably either the latter, or to keep the judge from ROFLStomping them.

Too big

[georgenh16]

Any organization that gets too big is a breeding ground for such stupidity and infighting.

Why we can't seem to learn that lesson and apply it to the government like our founding fathers did... this always saddens me.

I believe the ACLU beat them to it

[gmagill]

http://www.byproducts.com/art/2000/5/958683840/index.html

Win-Win!

[georgenh16]

If they lose, the government will bail them out!

If anyone knows about sueing themselves it's

[doconnor]

FoxNews

Follow the (Insurance) Money

[Anonymous Coward]

You need to follow the money. I suspect they are following the legal steps to cover their a$$es. Then, should they fail to recover the 2nd liens, they can invoke their in$urance policies and recover their lo$$es from the insurance carriers.
Back in the late 90's I couldn't sell my house and went thru bankruptcy (we needed to leave the area). The bank wouldn't negotiate a short sale. If they did, they would have taken a loss, but because we passed thru bankruptcy, they could recover the full balance of our mortgage from the insurance company. The PMI that cost me several thou$and at closing paid out many times over for the bank.

Who own's first?

[sparhawktn]

Bud: Fargo owns first mortgage
Bud: Fargo owns second mortgage
Bud: I don't know owns third mortgage
Lou: That's what I want to know who to sue first
Bud: Fargo!
Lou: Fargo owns second?
Bud: Fargo owns first.
Lou: I don't know
Bud: Third base!


*Apologizes to Bud Abbot and Lou Costello

Re:Who own's first?

[Anonymous Coward]

I thought you were referring to Bud Selig and Lou Piniella.

I'm glad

[Presto Vivace]

that I am not the flack who will have to explain this to investors.

Tax deductable?

[piemcfly]

This seems like a great way of laundering money...

1 - Sue yourself over some bullshit
2 - Pay outlandish fees to lawyer who's in on the deal (on both sides, of course, can't wait for him to object to himself in court)
3 - Make court battle drag on with continuously unearthed 'new evidence'
4 - Keep paying outlandish fees
5 - Settle case with yourself (including ridiculous settlement fee)
6 - Profit!


Or do even better: sue yourself over an issue that allows for tax deduction.
There are probably some details I'm overlooking here, but with some legal loopholery I'm sure this can work.

Yeah...

[nizo]

This is exactly why I don't bank with Wells Fargo anymore. Even the simplest tasks seemed to take them forever to fix. Apparently I should have asked them to sue themselves to fix day-to-day problems.

He who represents himself has a fool for ....

[Anonymous Coward]

So basically, Wells Fargo is relying on the tax supported legal system to handle it's own internal functions. This is a fantastic outsourcing strategy!!

nice..

[josepha48]

ok, so anyone here still not understand why the banks are so screwed up and why america is as screwed up as it is financially right now? Our corporate leaders are a bunch of idiots, who can't tell the difference between a hole in the wall and .. well if you need me to finish that statement, then you're right there with them!

Their real goal

[kimvette]

If you think it's just utter stupidity, you are sorely mistaken. The intent is far more insidious. As one of the investors in the LHC they took a bath when the LHC turned out to be an utter failure. They wondered how they could achieve their goal.

Then it struck them, and it was a PHB up top who came up with the idea, much to the surprise of the team. If you create a lawsuit which is utterly idiotic, such as a fortune 100 company suing itself, you are bound to create a singularity.

That's it folks. They are betting on the stupidity and greed of lawyers being enough to trigger the creation of a sustained artificial singularity.

The next step is to figure out how to make it profitable, but like the modern American dream, they are going to leave that to the developing Asian countries to figure out.

Re:Their real goal

[spun]

You almost got it right. The stupidity singularity comes from ill informed Slashdotters discussing things they know nothing about, assuming their common sense trumps any expert in any field but their own, and laughing at things they have no comprehension of. Try reading the fucking article, rather than trying to make a pointless and convoluted joke which only highlights your own stupidity with neon signage. In truth, the law and the lawsuit both are sensible and comprehensible. If you can't figure out why, try going back and reading the dozens of comments from people who took the time to RTFA.

P.S. I'm pretty sure that you called people who tried to 'participate and debate' the Bush administration anti-American traitors. Now you can participate and debate without having to go to a fucking free speech zone and registering your phone number for mandatory wiretapping. Just because no one listens to you or respects your minority opinion does not mean you are being censored, but it might mean you are an idiot.

Re:Their real goal

[gzunk]

Wow, they invested in the Large Hadron Collider at CERN? I'm sure it's not an utter failure yet and Wells Fargo might yet achieve their goal of finding the Higgs Boson!

Re:Their real goal

[gzunk]

Whooosh

There I did it for you.

Advice from the past

[ellbee]

"The first thing we do, let's kill all the lawyers". - (Henry VI Act IV, Scene II - Shakespeare, ca. 1623). Good idea then, good idea now.

Re:Advice from the past

[xednieht]

Mod parent up +10

mad dog biting itself for sympathy department

[swschrad]

yada yada "serious issues of tort practice that need to be resolved in a timely manner" yada barfo hack hack spit.

dismiss the suit, all the lawyers representing all the various offices of Wells Fargo against itself will have a conflict of interest. get the two pinhead managers in a room, lock the door, and sell the video on satellite for $19.95 to settle the debt.

Noooo!! Tag article as LOOPBACK

[Anonymous Coward]

This is just sad.

No, no, NO! You don't understand. This is a case of corporate autoimmune disease (think rheumatoid arthritis)...or management has unlocked the mysteries of 127.0.0.1 .
 
Yep, that's gotta be it. Loopback.

Why make fun of the bank?

[John Hasler]

The government made the loony laws.

Syndication of the loan...

[apederso]

The problem that most people aren't thinking about is that all though Wells Fargo is probably the servicer of the loan, and was definitely the originator of the loan, they have most likely syndicated the loan- packaging it into a CMO or CDO and resold the interest in the loan to a variety of parties. The covenants of those CMOs often make it challenging to settle without legal action, so when Wells sues itself it may very well be because that is the only way to resolve the interests of one CMO holder (the people who bought the interest in the first loan) against the second CMO holder (the person who bought the interest in the second loan) without the appearance of impropriety. I agree this is totally stupid, but the system is the problem here. If we'd gone with a more transparent and regulated secondary market for mortgages such as the one that exists in Denmark see wiki here we wouldn't have all these problems. In Denmark the loans and the bond match each other very closely, and you can actually by the bond and use it to pay the mortgage, but that is material for another post...

Re:Syndication of the loan...

[PPH]

Good explanation. And an informative link to the Danish system.

But what is missing is an explanation of one of the principal features of the US mortgage system: The ability to repackage the risk involved with mortgage (and other types of) securities such that one class of investor can realize a risk-free income stream. Meanwhile, other investors, or banks, or eventually the US taxpayer, get stuck with worthless mortgage paper.

In Denmark the loans and the bond match each other very closely, and you can actually by the bond and use it to pay the mortgage,

That's nice, bit it ain't gonna happen over here. It would make unwinding bad mortgages and calling back the securities too easy. And the low or zero risk CDO tranches would have been called back right along with the toxic garbage. When the Obama administration suggested doing just this, it was met with howls of protests. From people with enough pull in Congress to make sure that, whatever else happens, nobody is laying a finger on their money machine.

Re:Syndication of the loan...

[vlm]

without the appearance of impropriety.

Essentially this whole case is about outsourcing the risk of corruption to the legal system/judge.

If they didn't get the judge involved, then at any time in the past, WF could have lied to the CDO holders by saying "uh, you know that interest payment you been gettin? we say you aint getting that no more" and no one would have been the wiser, although WF would have been richer.

WF has a fiduciary responsibility to protect the CDO holders at the same time as it has a fiduciary responsibility to protect themselves, thus buying into a deal where one bank owns both sides of a 80/20 is pretty dumb, although the legal system is involved to at least try to protect the CDO holders from gross corruption.

This way, the judge verifies its an honest deal, a real genuine foreclosure, on the judges word the CDO holders are screwed and the CDO holders can at least probably trust the judge is telling the truth, or at least truer than WF whom is working both sides since they own both sides....

Re:Syndication of the loan...

[Artifakt]

Filing may be required, although if so that's not just a result of Florida law, and right now, is only conjectural re. a third party covenant, but disputing the facts as stated in the original claim isn't required. As it stands, if one representative of the company makes a claim and the other disputes it, since both of them can check their information inside the company, and have an obligation to check before making statements, one of them has committed perjury. How will doing that protect the company from a legal challenge?

Fox news Fellas

[anonymousNR]

I don't see this anywhere other than foxnews

MODERATORS!!!!!1!!!!!!!!111 Mod Parent Up!

[Anonymous Coward]

Funnyiest thing I read all day.

You Guyz Just Don't Understand

[BigBlueOx]

With this lawsuit, Wells has evolved their business into a quantum state of simultaneous sue and be-sued ... uh ... ness. This state of legal "entanglement" allows a powerful paradigm to emerge: the instantaneous transmission of money to lawyers with no need to perform the usual classical intermediate steps.

Wells should be applauded for realizing that, in the actual macrocosmic world, corporate intelligence is less than h-bar/2 (in pounds, dollars, yen units) and that the Hamiltonian of their financial assets is an unbounded quantity now that the US government is included in the function.

Well done, Wells.

They do this stuff all the time

[mschuyler]

My mortgage was with them. I paid it off. Rather than release the title to me, they 're-conveyed' the trustee from the loan department to the pay-off department, complete with a filing to my County, then the pay-off department re-conveyed the title to me. WTF? When I called to ask what was going on, they didn't know! Finally I got together with my county auditor who explained to me what happened. I DO have clear title----I think.

Re:They do this stuff all the time

[freedom_india]

Check and double-check with a lawyer to see if you have a unencumbered title.
Clear and unencumbered are different.
File a discovery suit, ask for clarification letter from the bank, and if they refuse to produce it, sue them.
I sued a bank when they refused to return a promissory note back to me after acknowledging that i repaid the loan in full.
Only then did they return the original.

What about..?

[Anonymous Coward]

No one can be forced to testify agains itself?
It's a Paradox!

Are we going to implode?

Mod Parent Up

[Anonymous Coward]

I figure i'm between 1 and 2.

The audacity of your post

[Anonymous Coward]

Wow. So you speculated on bubble properties, decided to become a deadbeat, and you bitch that YOUR tax money is being misappropriated??

It is the tax money of RESPONSIBLE homeowners and renters that is going to subsidize speculating bubble inflators like YOU.

I hope you get cancer and your wife fucks your brother after the funeral.

Quantum corporation?

[Anonymous Coward]

Wells will both the winner and looser at the same time, making it a quantum corporation.

You know when the economy is getting bad when...

[Anonymous Coward]

lawyers start coming up with these kinds of cases. Of course all the good government jobs for lawyers are taken already.

Re:In all actual seriousness...

[harpune]

You can at least remove yourself from the whims of some of these corporations. Find yourself a local credit union, and put your money there. They're not perfect, and they don't have all the fancy 'Get an iPod when you open a credit line' deals, but a stable place to keep your money, that is more or less customer-owned, should outweigh those gimmicks. I haven't looked back since I opened an account at a CU after WaMu went down.

The Hack is comming from your own Machine!!!!

[jameskojiro]

From port 127.0.0.1 !!!

OMG, Ponies!

Re:The Hack is comming from your own Machine!!!!

[Anonymous Coward]

That's some port. Which internet are you on exactly?

Re:The Hack is comming from your own Machine!!!!

[nonamez]

This is just proof that in any lawsuit, the only people to always win are the lawyers. Forum

Re:In all actual seriousness...

[jahudabudy]

Yep, I love my credit union. Stable, willing to actually work with me, doesn't try to squeeze every dime possible out of me. The only thing I wish is that their credit card offered frequent flyer miles. Oh well, can't have everything.

Life imitates art

[Anonymous Coward]

"Nobody move or the nigger gets it!"

Re:Life imitates art

[BobMcD]

"Nobody move or the nigger gets it!"

Which, for those under 30 or so, is a near-quote from a ground-breaking comedy called Blazing Saddles. (http://en.wikipedia.org/wiki/Blazing_Saddles)

"The film exposes the racism obscured by myth-making Hollywood accounts of the American West, but in a highly satirical way; the racist slur "nigger" is heard 17 times in Blazing Saddles, while the film's hero is black."

http://www.youtube.com/watch?v=upvZdVK913I - 2:48 or so...

If you're not aware of this film, you probably should be, IMHO.

OB Python

[mojotooth]

I find the defendant NOT ESTHER WILLIAMS

Haha

[Anonymous Coward]

Troll? Parent is absolutely correct, even if the cancer bit is over the top.

Re:Haha

[brkello]

No, it's a troll. The guy probably isn't a speculator if they are living in the house. And Wells Fargo would have been better off working with him for payments rather than having something sitting on the market doing nothing. The cancer thing is more than over the top, it is disgusting.

And that bailout money to the banks had to be paid back with interest, so not sure what the big deal over that is either.

Re:Haha

[Anonymous Coward]

Two points.

#1 The GGGP specifically said "I had a investment property...". He did not live in the home. It was absolutely a speculative play.

#2 TARP is not the main way renters and honest homeowners will subsidize flippers like the GGGP. Subsidized mortgage adjustments for "troubled homeowners" and the Fed reflating the bubble by buying $1.25T in GSE debt, is more than enough to do it.

Re:Haha

[iamhassi]

"And Wells Fargo would have been better off working with him for payments rather than having something sitting on the market doing nothing."

I tried working with them on the interest but they wouldn't hear it. Not sure how they calculated it, but being 3 months late somehow gathered interest worth 6 months of payments within 2 years. The people I talked to on the phone couldn't explain how they calculated it either, just that it had to be paid.

I was living in it until it was foreclosed upon, hence the "much of the $$$ was spent on purchasing and moving to a new house." I bought it for investment and I had renters in and out of it, but whenever it was empty I'd move in and make repairs, spruce it up a bit, etc.

It's a shame banks and buy and sell mortgages at a whim and the borrowers have no say because some lenders can be really great (like Avelo and Litton) and others complete idiots (Wells Fargo).

Reference a Win!

[transluent_eye]

Ah....but then they can cite this case in further cases as a win for themselves.

Conflict of interest?

[pesho]

No lawyer would agree to this. This would be a obvious conflict of interest and lawyers have standards. Banks on the other hand ....

The Rutles

[BenSchuarmer]

"In the midst of all this public bickering, "Let it Rot" was released as a film, an album, and a lawsuit. In 1970, Dirk sued Stig, Nasty, and Barry; Barry sued Dirk, Nasty, and Stig; Nasty sued Barry, Dirk, and Stig; and Stig sued himself accidentally. It was the beginning of a golden era for lawyers, but for the Rutles, live on a London rooftop, it was the beginning of the end."

sounds like a growth industry

[tmbailey123]

They need something to replace the credit default swap sham business.

Why am I reminded of the film...

[WolfTheWerewolf]

"Road Lawyers"?

Don't call it idiocy too hastily

[Opportunist]

I remember Visa offering people so deeply over their head in debt that they can jump ship if they offer to close their account with them and their debt is forgiven. That way they can file for bailouts and, unlike people who are in over their head, the government can actually (at least so far...) pay.

I could well see something like this here too, just a hint more nefarious. Could you see something like "sue - get title - get no money from debitor - get bailout"?

The lawyers always win

[JoeF]

This is just proof that in any lawsuit, the only people to always win are the lawyers.
Here, we have two law firms getting money from Wells Fargo.
And if they continue with this kind of stupidity, Wells Fargo may need another bailout...

insurance fraud?

[element-o.p.]

Maybe I'm just paranoid, but I can't help but think that if Wells Fargo is suing themselves, it has to be because they think there is some kind of revenue to gain from it. First thing that comes to mind...do banks have some kind of liability insurance in case they get sued, along the lines of malpractice insurance for doctors?

If this is the case, then as long as the policy is underwritten by someone else, then Wells Fargo gets a net income from the deal. If Wells Fargo the plaintiff wins, then the insurance pays legal fees and damages for Wells Fargo the defendent. Otherwise, the insurance pays the cost of the suit for Wells Fargo the plaintiff. In either case, Wells Fargo gets free money, the insurance company loses, and the cost of the law suit gets spread out to all the other customers of the insurance company in the form of rate increases. Sounds like insurance fraud to me; I can't believe that this would actually fly.

All your lawsuits are belong to us...

[gestalt_n_pepper]

We have met the enemy and they are us! Charge! Interest! Damn the logic! Full Speed Ahead! Aaaaaaaaaaaagh!

Re:In all actual seriousness...

[AndersOSU]

I'm begrudgingly committed to my credit union.

The only things that I wish, is that they had better hours (national banks don't keep bankers hours anymore) and that there were more no-fee ATMs.

I actually really like ING, but they've been cutting their interest rate for about a year and a half now - I know it makes sense, but that doesn't mean I have to like it.

Internal Revenue Code Section 7872

[Anonymous Coward]

Wells Fargo received tax-payer money via loans with "below-market" interest rates. Internal Revenue Code Section 7872 says the amount of foregone interest is taxable income to the borrower.

Unfortunately, Wells Fargo is not officially affected by IRC section 7872 only because the IRS is currently claiming everybody should be able to get loans at rates of 2-3% which is absolutely ridiculous. If Wells Fargo could have borrowed as much money as they actually did at a rate as low as they actually received, they would already have borrowed it.

Python

[Anonymous Coward]

And in the red corner, all the way from Rygate, in Mozambique, Colin "Bomber" Harris...

Nonsense.

[Estanislao Mart�nez]

This is all just nonsense. Courts exist to settle disputes between conflicting interests. Wells Fargo can't sue itself because it can't have a dispute with itself; the two "parties" to this "dispute" have, by identity, the exact same interests. So the argument you're making, that Wells Fargo really ought to argue both sides of its self-suit earnestly in order not to bias the proceedings, just rests in the absurd premise that a party can sue itself.

The correct thing is for Wells Fargo, as the primary lien holder and one of the secondary lien holders, to sue all of the other secondary lien holders. The proceedings and decision should take into account the fact that WFC is both a primary and a secondary lienholder. So, for example, WFC should argue along the liens that as primary lienholders, they should get X, and that if they somehow don't get it, as secondary lienholders, they should get Y.

Re:Nonsense.

[BSDevil]

WF does have conflicting interests - those of the senior mortgage-holder and the junior mortgage-holder are different, and as such, they need a settlement to secure hose interests. While they're the same company (at the top level), what matters more is the roles they're occupying in this suit. So what the parent said is right - they (WF senior mortgage) need to treat all other creditors below them as equals in order to avoid allegations of preferential treatment, and the other they (WF junior mortgage) need to do their fiduciary duty to their shareholders and try to defend their interests in the building.

Admission?

[DragonWriter]

Extreme economic problems require extreme solutions, and Wells Fargo Bank has come up with a good one. They have decided to sue themselves. Wells Fargo holds the first and second mortgages on a condominium that is going into foreclosure. As holder of the first, they are suing all other lien holders, including the holder of the second, which is Wells Fargo. It gets better. The company has hired a lawyer to defend itself against its own lawsuit. The defense lawyer even filed this answer to the complaint, "Defendant admits that it is the owner and holder of a mortgage encumbering the subject real property. All other allegations of the complaint are denied."

Insofar as Wells Fargo (as defendant) is denying its own (as plaintiff) allegations, shouldn't all the other defendants be able to enter in Wells's own denial of those allegations as an admission, by Wells, that the allegations are false and, further, that Wells knows them to be false, justifying both dismissal of the suit and potentially other sanctions against Wells?

Might not be as stupid/sad as it sounds

[Roger W Moore]

I suspect a tax dodge somewhere.... aren't damages tax free?

Apparently the practice is quite common...

[levicivita]

... based on lawyerly-sounding comments in response to the article. IANAL so I do not have a clue whether the technical argument is correct or not. I still stand by the author of the original article, and agree with him that this practice, whether consistent with the law or not, is idiotic.

Florida is a judicial foreclosure state. Meaning all foreclosures are addressed by the court system. The Florida law requires that the lienholder bringing foreclosure suit against the defaulting borrower.....also include ALL junior lienholders in the suit. Wells fargo also has a junior lien. Hence it names itself as a defendent. A responsibility of the Junior lien holders is to re-affirm their lien....if it still exists. If they don't respond to the complaint...the court assumes the lien is no longer valid. Because a foreclosure can be set aside if the plaintif doesn't follow the letter of the law... Wells names itself as a defendent. Al's article sites a foreclosure attorney...who states this is fairly common in Florida now for banks holding two liens against a property. So how dumb is Wells suing itself?? It is not. It conforms to the letter of the law. And again, Al's article notes it is a frequent event in Florida today. Second...whether Wells loaned 100% of the property's value via its too loans...we do not know!! If this was a "dumb" loan to start with...how do we know without seeing the loan file and application? And this will not be shared by a bank under privacy rules. I looked into this because this article seemed too hard to believe.

Adds new meaning to the term...

[Hawthorne01]

"Suit yourself."

Lent? Hmm...

[zooblethorpe]

Not given, lent. Wells fargo will pay that money back in full.

Call me a cynic, but I'll believe that when I hear about that money actually being paid back to the US Treasury.

Cheers,

Calling yourself a liar

[DragonWriter]

I RTFA, and it appears that Florida requires that you sue all lien holders. Since they have 80/20 double mortgage, they have to sue themselves.

Even so, I doubt very much that Florida law requires them to deny their own allegations; you are never required to contest the points made by someone suing you, and it is especially ridiculous to deny claims that you yourself are making.

Re:Lent? Hmm...

[rhsanborn]

Some banks already have started. http://www.nytimes.com/2009/06/10/business/economy/10tarp.html

Re:In all actual seriousness...

[crazyjimmy]

My credit union is part of the Co-Op Network. As such, I have tons and tons of free ATMs scattered throughout the valley. It's a good deal.

$2 $1

[wrencherd]

One possible explanation could be that by virtue of being on both sides of this lawsuit, one single financial institution--Wells Fargo--can now claim twice the federal money committed to helping lenders make up for losses related to the "mortgage crisis".

Also in technology

[Mr_Silver]

This kind of thing happens in technology too.

Unfortunately my Google Fu is failing but I distinctly remember a long time ago the music industry suing manufacturers of CD writers claiming that they facilitated copyright infringement.

Sony, as both a content provider and hardware manufacturer, managed to end being in both camps.

This is neither original nor funny

[microbee]

Same thing has happened with the federal government.

Seriously, this is no joke. It's called Conflict of Interest.

Fox is not a legit news source

[Anonymous Coward]

Republishing anything Fox "news" puts out is like reading a National "Enquirer" story reprinted in the church newsletter.

not schizophrenia

[Anonymous Coward]

Who would have thunk a fictitious person could develop schizophrenia!

Not schizophrenia, dissociative identity disorder. Schizophrenia (from Greek roots meaning, basically, "broken brain") is a different term that refers to a different mental illness.

I understand that you're making a joke. But your language failed. Sorry to geek out over it.

Re:not schizophrenia

[Yert]

I understand that you're making a joke. But your language failed. Sorry to geek out over it.

Not geeking out, Obsessive-compulsive Disorder.

Head up their own a$$.

[Neanderthal Ninny]

This is truly a "head up their own ass" moment so let me savory this. The banks & financial institutions have been crawling around looking for "dark places" they didn't know it was their own ass.
All of these banks and financial institutions don't have a clue what they are doing and this lawsuit shows on aspect of this. Also the regulators that supposed to protect us from these idiots and goons are no better in helping us since they have been paid off by the industry they have are supposed to regulate.
The entire banking & financial industry and the regulating system needs from foundation up reform and replacement since the current system is to corrupt to just to reform. Ground up is not good enough since the foundation has been compromised.

It's part of the cunning plan

[Platinumrat]

In the OP it says it all "As holder of the first, they are suing all other lien holders, including the holder of the second, which is Wells Fargo.". If they're successful in getting the courts to agree that that have to cough up to themselves, then it's a simple step to get the other 2nd holders to cough up as well. IANAL

Perfectly rational

[Actually, I do RTFA]

Wells Fargo, owning the primary morgage, has to sue all secondary lien holders. They are owners of a second lien (thus a secondary lien holder), so they either have to sue themselves, sue no one, or give up the second lien.

If they sue no one, they cannot easily foreclose (have to settle with everyone).

If they give up the second lien, and lose the lawsuit against the other secondary lien holders, they lose out on monies they would otherwise be entitled to, by owning the second morgage.

Suing themselves is an insurance policy against losing other lawsuits.

IANAL, but other articles seem to make this point clearly, like the Monty Fool

Compile-time

[jDeepbeep]

Law is sometimes like code, in that it can create unexpected and unintended behaviors when executed literally. It's not stupid, IMO... It's a sign that we need better law.

And better compile-time checks. :)

Re:Compile-time

[Burning1]

Alpha status and pre-release regression testing would be nice too. :D

Realtor Law for ID10T's

[LifesABeach]

When the Buyer of the Property defaults on their loan, the holder of the Title property,(which was the collateral in case of default), notifies the Lean Holder and the 4th, 3th, and 2nd TD holder's. These people have a chance to step in and take ownership of the property by paying the outstanding debt to the Lean Holder. If this cannot be done, in other words, no one wants the property, the Lean Holder "takes the Title of ownership". The title was held as "collateral" for the debt. If no one steps up to resolve the debt, the Lean Holder now owns the property. Nothing magical here. As for suing itself, I can only hope it goes on the corporations Credit Report. I can see why President Obama helped the banks so that BRIC nations wouldn't screw up this mess even more. But who ever said that these businesses were to big to go under is full of foundation-less nativity. When can we STOP "helping" these suicidal cultures that still think its OK to defecate in their potables before drinking?

Re:Realtor Law for ID10T's

[freedom_india]

If the owner had a bit more brilliant than Wells Fargo he could have avoided this by:
1) Having the first lien from Wells Fargo
2) Having a second and third liens from entirely different banks.
Default on second and subsequent liens, but continue paying first mortgage diligently.
Now, if the Second and subsequent morons holding the bag sue the borrower, he can tell them with a straight face: "So sue me."
Which they will.
Unfortunately the first bank will automatically step into defend him against them since they hold the lien.
These morons cannot get him to vacate the house as long as he pays the first mortgage.
Wow. I wish i could have taken advantage of such a logic.

Re:Realtor Law for ID10T's

[LifesABeach]

Actually, the 2nd, 3rd, and 4th TD holders would sue the borrower, and be able to acquire the property. The holder of the 1st TD would also have to agree. The holder of the 1st TD would still hold the Title, but payments would come from the 2nd, 3rd, or 4th TD holder as the new owner. I know of one person who had a 1st, and 2nd TD with Wells Fargo, they foreclosed on him and they lost their 2nd TD for their efforts; go figure. I have no pity for a bank that gambles.

Re:In all actual seriousness...

[harpune]

Seriously, this is one of my favorite features. There is a Co-Op ATM in the 7-11 a block from my house. It's a million times more convenient for me than my old bank. Plus, there are Co-Op credit unions all over the place.

Total

[Anonymous Coward]

Genius!

like a fox

[AlpineR]

Say I own a company that supplies parts to automobile manufacturers. Say I also own stock in one of those automobile manufacturers. Say that automobile manufacturer violates a contract with my parts supplier. Is it crazy for me (the owner of the supplier) to sue the automobile manufacturer (which I also partly own)?

The article mentions other lien holders. It sounds to me like an entity is suing a pool of entities. If they win, then each member of that pool pays the first entity a share of the settlement. Having a stake in the losing side just means that they net only 80% of the settlement rather than 100%, not that the entire case is a wash.

Re:like a fox

[snowgirl]

Say I own a company that supplies parts to automobile manufacturers. Say I also own stock in one of those automobile manufacturers. Say that automobile manufacturer violates a contract with my parts supplier. Is it crazy for me (the owner of the supplier) to sue the automobile manufacturer (which I also partly own)?

The article mentions other lien holders. It sounds to me like an entity is suing a pool of entities. If they win, then each member of that pool pays the first entity a share of the settlement. Having a stake in the losing side just means that they net only 80% of the settlement rather than 100%, not that the entire case is a wash.

Especially, with being the first and second lien holders. Let's say that there are 4 liens in addition to any that WF owns. If they win, they get 80% of the settlement, if they lose they have another run to get 100% of the settlement (which would be 80% of the original settlement)

Sue yourself... and win!

[Anonymous Coward]

Many years ago - I was in college... we were having some fun with *cough* windowpane *cough* and started dreaming up things... Topping the list was "Sue yourself... and win!" as the title of a book for newly minted lawyers...

I never in my wildest dreams thought that crazy trip would ever actually come to fruition... Go Wells Fargo! Share the wealth!

Why this makes sense (to a lawyer)

[sampson7]

Actually, what they are doing makes perfect sense and is in fact likely required by law. More importantly, a court proceeding is the only fair way to conduct this type of proceeding.

Think about it -- most states require that a judge review a foreclosure before it can be processed. One of the requirements is that before the property is sold that all potential lien holders must be contacted and given their chance to assert a claim. In fact, before the property can be sold, the secondary lien must be extinguished -- which requires a court order. Likely, the only way to proceed is to sue all the other lien holders.

Don't forget -- Wells Fargo is about to foreclose on some poor soul, and it not only holds the first lien, but the second as well. Likely, the two liens have different terms. I suspect that there may be some mortgage insurance involved in this case. It seems likely that the first lien is insured by a mortgage insurance company separate from Wells Fargo. ACME Insurance Co. has an incentive to protect its investment by actively litigating to protect its interests vis-a-vis the second lien holder. Most commercial insurance policies have a clause that allows the insurance company to appoint a lawyer to defend its interest. Thus even though Wells Fargo NA is the litigant (on both sides), it's entirely possible that they have little control over the litigation of the case.

Further, involving a judge when there is so obviously a conflict of interest is a good way to avoid being sued in the future. Most likely, there is a "Chinese Wall" separating the different branches of Wells Fargo. Wells Fargo has a fiduciary obligation to the landowner in this transaction.

With any of these permutations, it is perfectly logical that Wells Fargo would file suit against itself where there is such a flagrant conflict of interest. The presence of a judge in the proceeding -- at a minimum -- will give a veneer of credibility to the proceeding and (theoretically) ensure that the landowner's interests are represented.

Taking the insurance example, it might be in Wells Fargo's interest to dump the costs into the first or second lien. Generally, a first lien is less risky than the second lien. Perhaps the first lien requires the lien holder to repay all costs associated with foreclosure, while the second lien does not. Perhaps there is sufficient money in foreclosure to cover the first lien, but not the second. The possible permutations are endless. Either way, it is possible that Wells Fargo could serve its corporate interests by "rigging" the system in its favor.

Or it could be a big cock-up. Pretty funny either way, but not necessarily crazy.

They read Ubersoft!

[Sebastian Reichelt]

OMG, XKCD is no longer the only comic to change the world:

http://www.ubersoft.net/comic/hd/2008/02/viktorgate/ and following

Not so stupid if you figure in tax laws...

[Perf]

The payouts are considered a business loss. Money received from a lawsuit is tax free (because it is considered compensation for money already owed.)

Company A sues itself for $1 million to be paid out $50,000/year for 20 years. Each year, it deducts a $50,000 payout. Each year, it gets $50,000 tax free.

No, just no.

[Estanislao Mart�nez]

While it may seem stupid (and I agree with you, it does), it is apparently necessary for the particular suit to go forward, as GGP says. Usually, I would say this means the law needs to be changed; however, this law actually makes sense. This just happens to be a really strange application of that law.

No, the idea that a lawsuit is a way of settling a dispute between two different parties is so fundamental to the law that the statute in question must be interpreted not to require a party to sue itself. You. Cannot. Sue. Yourself. It doesn't matter what some random statute says; courts don't hear cases where a party opposes itself, because, to put it technically, it is pointless and stupid; there is no dispute to resolve.

The reason is in the summary...

[Radtastic]

"As holder of the first, they are suing all other lien holders, including the holder of the second". I interpret this is as there are likely multiple lienholders, and it's improper to selectively choose who to sue.

IANAL, so someone feel free to chime in here...

Re:Lent? Hmm...

[zooblethorpe]

In the same NYT article, we also read that some other banks have not been allowed by the Treasury to pay back their loans, due to concerns about capital adequacy should the current economic situation change. It sounds like Wells Fargo could fall into this same category.

Cheers,

I'm not convinced...

[Anonymous Coward]

I've RTFA and TFL and I don't think situations like make sense and could in this case have been foreseen. I think they were deliberately not foreseen because the law was drafted by lawyers and this causes more lawyers to get a fat pay.

Um, no.

[Estanislao Mart�nez]

Wells Fargo (holder of the senior mortgage) is trying to clear out all the subsidiary mortgage interests so that it can sell the property. In the process of doing so, it has to sue itself for record-keeping purposes - if I'm going to buy some property, I want a clear case record showing that all existing claims have been discharged.

Um, a few points:

1. Courts don't exist for record-keeping. They exist to settle disputes between legal persons.
2. The record is clarified plenty enough by WFC, as plaintiff, simply demonstrating in its filings that it is both the primary lien holder and one of the secondary lien holders.
3. WFC cannot complain that it was damaged by the discharge of all of the secondary liens when this was done in favor of its own primary lien. Why? Because in that situation, WFC's primary claim was left as the only claim--which means that all of the money that is recovered goes to WFC, and WFC would not stand to get any more redress if its secondary claim was left.

Re:Lent? Hmm...

[moosesocks]

Start believing.

Goldman Sachs, JP Morgan, Morgan Stanley, American Express, Capital One, BB&T, and US Bancorp have all paid back their TARP (bailout) funds, along with two dozen smaller banks.

Citigroup, Bank of America, and Wells Fargo are actually not allowed to pay back their TARP funds until their own finances stabilize.

In Soviet Russia..

[bronney]

The Motherland su..... wait..

You're missing one crucial detail from TFA...

[celtic_hackr]

There are no other lien holders OTHER than Wells Fargo. They could get the clear title by simply by paying off the first and second liens with their own cash and taking out a new lien combining the two liens into one. Of course that would probably require the cooperation of the person/entity that took out both mortgages. Or alternatively, they could do several other things that simply don't require them to sue themselves.

I personally don't see how you can sue anyone to get a clear title. If I have a judgment against consumer X and have a court ordered lien on his property, suing me for my lien won't get you a clear title. The only way to release my lien is to pay me what the lien is worth. If, I had a lien against a piece of property, and someone sued me to release that lien, I'd file for summary judgment in my favor and for attorneys fees and punitive damages. There are only two ways to get a lien on a piece of property, that I know of: one by legally binding loan contract, or by a court order. Either one of those would be positive proof of my lien claim and hence there could be no dispute as to the facts.

But then this IS Florida AND the US Court System we are talking about, and there is certainly no lack of stupidity in that state. I know, I've lived there briefly and saw the rampant stupidity well before Bush vs. Gore. The only people dumber than the people of Florida are the tourists in Daytona Beach. If you don't believe me, go there sometime and get to the beach early at low tide. I once saw a man "washing" (rinsing more like it) his car with water from the ocean, to "get the sand off". Yes, I actually had to ask this guy what he was doing and why. For my own morbid curiosity.

Re:Lent? Hmm...

[zooblethorpe]

Bingo -- I thought perhaps they (WF) might be shaky enough to be on the not-allowed list, as noted on the WF Wikipedia page.

I'd heard about other banks paying back, so that in itself is not a surprise. My cynicism is threefold -- one, that the bank might well wind up going under or undergoing some similar transformation that prevents the full amount being repaid to the Treasury; two, that the bank might engage in some paperwork complications and subterfuge to avoid repaying the full amount; or three, that the bank might successfully lobby to avoid repaying the full amount. Or, I suppose, some combination of the above.

Many things are possible. As I said before, I'll believe it for Wells Fargo in specific when I see it.

Cheers,

Don't forget saving in Insurance

[corsec67]

I have never had a car loan, a lien on my car, or even comprehensive insurance on my car, which made insurance about a cheap as possible.

Driving cheap cars has a lot of savings. I moved to Japan, and wanted to keep my history with my car insurance company (USAA), and being insured not owning a car was only a little cheaper than the insurance I had on my car. Not having a lien on my car meant that I could sell my car in 15 minutes, no need to get permission from anyone to do that.

(USAA gave me a $5/year plan for expatriates to keep my account history with them, so if I return to the US I can continue with my history of 8 years of claim free coverage)

Is it even bad law?

[tgibbs]

I have to wonder if it is even such bad law. Presumably, the law would have to be made more complicated to include exceptions for the case where the same corporate entity holds both a first and second mortgage, and complexity and exceptions can make loopholes and generate extra legal costs. For example, is it really a public benefit to make it cheaper for a company to hold both first and second mortgages on the same property? Is a bit of extra legal expense for Wells Fargo really a high price to pay for straightforward law? And since Wells Fargo is employing the lawyers on both sides, and is probably a valued client, they presumably have the clout to stop the lawyers from unnecessarily running up the billing hours beyond what is required to satisfy the formal legal requirements.

Positive Wells Fargo experience

[austin987]

Perhaps I'm the only one, but I've had Wells Fargo for ~4 years, and it's been great.

The only bad experience I had was my checkbook was stolen while I was overseas (the checkbook was at the home I share with several guys, there was a party, strangers show up, college life etc.). I didn't check my balance much while overseas, and the dollar was weak, so didn't think much of it when my balance was low. When I got back to the states I noticed that there was a check written to one of my roommates for $75, which I didn't write. I confronted him about it, he denied it. Long story short, someone had stolen my checkbook and *HIS* debit card. They were then writing checks from my account to his name, depositing it into his account (with the debit card as ID), then withdrawing the money from an ATM (he was moronic and wrote down his PIN by the debit card).

After reporting to Wells Fargo, I was given some affidavits to sign, saying I didn't authorize the checks, under penalty of perjury, etc. I had a new checking account and the $900 that was stolen (plus $70 in overdrafts they had caused) refunded to me in about 3 days, with only about 45 minutes of work on my end.

Handled very professionally, I'd say.

Re:In all actual seriousness...

[rdoger6424]

Keep in mind that inflation is also going down. In fact the monthly inflation rate was negative for quite a while, and over the past 12 months, inflation has been at -1.2% on average. You'd actually get an ROI by stuffing your mattress.