The Corporate World - Thursday, November 6, 2008 15:19 - 0 Comments

Wachovia settles telemarketer suits for $200 million

Wachovia Corp., which is being bought by Wells Fargo & Co., has agreed to pay $200 million to settle lawsuits claiming it profited by ignoring fraudulent telemarketers who used the bank to help them steal from consumers. Victims of the telemarketing frauds filed suit in federal court in Philadelphia in 2007, claiming that Wachovia knew of claims the telemarketers were using “demand drafts,” or unsigned checks, to steal from their victims. The suits were filed on behalf of all people in the country who lost money to the telemarketers between June 2003 and February 2006. The settlement, which must be approved by the court before it can take effect, will reimburse $163 million the victims lost to the fraud, plus bank fees. In papers filed seeking approval of the settlement it was stated: “This settlement presents the rare instance in which class members have the opportunity to be made whole from any losses resulting from Defendants’ conduct.”

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