ACORN Announces Class Action Lawsuit Against Wells Fargo.

LOS ANGELES -- News Advisory: Monday, June 28th at 11:45 p.m. at Los Angeles City Hall, located at 200 North Spring Street, Los Angeles, CA

ACORN, the nation's largest membership organization of low- and moderate-income people, will file a nationwide class action lawsuit against Wells Fargo & Co. and Wells Fargo Financial, Inc on Monday June 28, 2004. The suit charges the company with a broad range of unfair and deceptive lending practices, including misleading borrowers about the real terms and conditions of their loans, "bait and switch" sales tactics, and routinely failing to inform borrowers with good credit that they can qualify for credit at significantly better rates and fees than those charged them by Wells. The lawsuit will be filed as a representative action in California state court.

On the same day that the suit is filed, more than 2,000 ACORN members from across the country will participate in a march and rally in Los Angeles, California, demanding an end to Wells Fargo's predatory lending practices. Victims of Wells Fargo's predatory lending will participate in the march, and talk about their experiences.

"ACORN will not allow Wells Fargo to continue to swindle and steal from our communities," said ACORN National President Maude Hurd. "We will fight until they stop their abusive loan practices, and the Wells stagecoach is no longer delivering misery to homeowners."

The ACORN members will be in Los Angeles participating in the organization's biannual national convention, and the weekend will also include other workshops and activities to strengthen ACORNs continuing work in protecting our neighborhoods from predatory lending.

The suit filed on Monday follows on a class action filed by ACORN in Illinois two weeks ago charging the company with collecting fees on high rate loans in excess of what is permitted by state law. In addition to private legal action, state regulators have begun to scrutinize Wells Fargo's lending. The Maryland Human Relations Commission has opened an investigation of the company in connection with concerns about racial discrimination, and the Louisiana Attorney Generals office has issued a Civil Investigator Demand in connection with abusive loan practices in that state.

ACORN members across the country have been fighting to expose and end Wells Fargo's predatory lending practices for more than a year. Borrowers and community residents involved in the ACORN campaign are concerned about a broad range of predatory practices by Wells Fargo, including charging unfairly high rates and fees, along with specific abuses including:

-- Promising low interest rates, and then charging high rates, even to borrowers with good credit. Wells Fargo Financial has no good policies in place to make sure that "A" borrowers get "A" loans.

-- Misleading homeowners into refinancing out of perfectly good first mortgages and into new loans, which cost the borrowers much more.

-- Financing large -- and often hidden -- fees into loans. Borrowers were routinely charged 7.5 to 11 percent in fees of what they borrowed. And since these fees were added into their loans, they continue to pay Wells interest on the money they borrowed to pay Wells itself.

-- Trapping borrowers with prepayment penalties which require them to pay thousands of dollars more if they want to escape into a better loan.

-- Attempting to escape from any legal consequences of their actions by slipping mandatory arbitration clauses -- which try to prevent borrowers from taking them to court -- into virtually all of their high cost loans

ACORN is the nation's largest community organization of low- and moderate-income families, with over 150,000 member families organized into 700 neighborhood chapters in 60 cities across the country. Since 1970 ACORN has taken action and won victories on issues of concern to our members. Our priorities include: better housing for first time homebuyers and tenants, living wages for low-wage workers, more investment in our communities from banks and governments, and better public schools. We achieve these goals by building community organizations that have the power to win changes -- through direct action, negotiation, legislation, and voter participation. ACORN is an acronym, and each letter should be capitalized. ACORN stands for the Association of Community Organizations for Reform Now.

ACORN's website is at http://www.acorn.org.

To receive updates on ACORN's work every two weeks go to http://acorn.org/getinvolved