The move by Wells Fargo meant that the bank would receive millions more dollars in processing fees, according to the lawsuit.
A California-based company filed a class-action lawsuit against Wells Fargo citing unfair actions against some small businesses seeking government-sponsored coronavirus relief under the Paycheck Protection Program.
In March, the Treasury Department announced the $349 billion forgivable loan plan for small businesses that helps them pay employees during the ongoing COVID-19 crisis. The fundThe lawsuit filed on behalf of small business owners on Sunday alleges that Wells Fargo unfairly prioritized businesses seeking large loan amounts, while the government's small business agency has said that PPP loan applications would be processed on a first-come, first-served basis.
"Making matters worse, Wells Fargo concealed from the public that it was reshuffling the PPP applications it received and prioritizing the applications that would make the bank the most money," the lawsuit filed in California alleged.USA TODAY has reached out to Wells Fargo for comment. The filing against Wells Fargo is one in a series of lawsuits lodged against big banks on behalf of small businesses late Sunday.
The big bank said on April 5 that it was committed to serving small businesses with fewer than 50 employees under the PPP, which is intended to incentivize American small businesses to avoid laying off workers by offering up to $10 million in forgivable loans. "While all businesses have been impacted by this crisis, small businesses with fewer than 50 employees and nonprofits often have fewer resources," Wells Fargo CEO Charlie Scharf said in a press release earlier this month."Therefore, we are focusing our efforts under the Paycheck Protection Program on these groups."
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