The charges center on minority home buyers. Legal briefs allege that a disproportionate number of minority borrowers were steered into subprime mortgages which tend to be more expensive. Many of those borrowers ultimately ended up defaulting on loans they could not afford.
Madigan's office issued a statement when the lawsuit was filed. "The dreams of many hardworking families have ended in foreclosure due to Wells Fargo's illegal and unfair conduct." For its part, Wells Fargo denied the charges.
Yet another lawsuit out of Illinois claimed the bank reduced home equity lines of credit illegally – without giving homeowners proper notice and relying on inaccurate assessment values.
Lawsuits aside, it is worth noting that many banking analysts see Wells Fargo as an institution that knows how to run a large retail banking operation. And while it has had some bumps on its balance sheet, the bank remains a bright spot in the financial industry.
Bart Narter, senior vice president of the banking group at Celent, believes much of the bad publicity is overblown. Narter added that within the industry the bank is "considered more competent than most." After all, Narter added, "public relations problems are not unique to Wells Fargo."
As for the Malibu beach house incident, Narter cautioned that even if the facts pan out as reported people should "judge the institution by how they handle it not by the actions of a single executive who may have abused his/her position."
After all, this is the same year Fortune magazine named Wells Fargo one of the most admired companies in America -- number 14 to be exact.