Wells Fargo (WFC) has agreed to pay $850,000 to settle a class-action lawsuit that charges the company with docking workers' pay whenever they ran a credit check that did not result in a loan.
The pact would resolve claims by Trevor D'Andrade, who once worked in New York as a consultant in Wells Fargo's home mortgage division, that the company withheld wages and commissions from him and other consultants in violation of state law, according to a filing by the plaintiffs Friday in U.S. District Court in Manhattan.
D'Andrade sued Wells Fargo on March 2011, alleging that the nation's fourth-biggest bank deducted up to $25 from consultants' pay each time they conducted a credit check of customers who later did not purchase a mortgage from Wells Fargo, which also allegedly subtracted money from the consultants' wages to cover the cost of home appraisals.
Wells Fargo, which has denied the charges, allegedly engaged in the practice for seven years starting in March 2005 without the consultants' consent.
Michael Palmer, a lawyer for the plaintiffs, said in an emailed statement he is pleased with the proposed settlement, which must be approved by the court.
A Wells Fargo spokesman did not respond immediately to a request for comment.