Wells Fargo settles forced-placement suit

|About: Wells Fargo & Co. (WFC)|By:, SA News Editor

Wells (WFC +0.6%) and the two insurance companies where it bought the insurance - Assurant (AIZ +1%) and QBE - agreed to repay certain homeowners up to 11% of the premiums paid. Documents don't show how many homeowners how much the total amount is.

The suit stems from mortgage servicer practice of buying homeowners insurance when the homeowner doesn't do so. Banks typically opt for very expensive policies and sometimes get commissions on the policies they force place.

The judge overseeing the Wells case last week granted final approval to a similar settlement involving JPMorgan and Assurant. He's also ordered an agreement be filed within a week on another case against Bank of America, and last month Citigroup and Assurant agreed to pay $110M in another forced-placement suit.