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Wells Fargo, Credit Wholesale and Priority Commerce agree to pay $19.5M to resolve CIPA allegations

June 2, 2025
Reading Time: 2 mins read
Fifth Circuit affirms $38 million lawsuit against Wells Fargo over stock sale

California Invasion of Privacy Act
Aguilar Auto Repair Inc. v. Wells Fargo Bank N.A.
Date: May 13, 2025

Issue: Wells Fargo, Priority Technology Holdings Inc., Priority Payment Systems LLC (collectively Priority), and the Credit Wholesale Company Inc.’s (Wholesale) agreed to pay $19.5 million to resolve a class action alleging they violated the California Invasion of Privacy Act (CIPA) by unlawfully recording calls without consent.

Case Summary: Wells Fargo, Credit Wholesale and Priority agreed to pay $19.5 million to resolve a class action alleging they violated the California Invasion of Privacy Act (CIPA) by unlawfully recording calls without consent and secretly recording telemarketing cold calls made to them.

Auto Repair Inc. and Central Coast Tobacco (plaintiffs) filed a class action lawsuit against Wells Fargo, Wholesale, and Priority for unlawfully recording calls without consent. Under CIPA, California is a “two-party state” that requires the consent of both the call recipient and the caller before a call can be recorded. According to plaintiffs, Wells Fargo hired Priority and Wholesale to manage, market, and sell its credit and debit card processing services to businesses in California and around the United States.  Plaintiffs alleged that Wholesale, acting on behalf of Wells Fargo and Priority, secretly recorded telemarketing cold calls made to them.

Plaintiffs specifically accused Wholesale of making thousands of telemarketing cold calls to small businesses to schedule in-person appointments where sales agents pitched Wells Fargo’s payment processing services. They alleged that, under Priority’s supervision, Wholesale recorded these appointment-setting calls without warning the recipients.

Under the terms of the settlement, the parties agreed to a $19.5 million settlement, with nearly 19,000 claimants each receiving an average of $680.49. Although they accepted the settlement, Wells Fargo and Priority denied having a principal-agent relationship, pointing to their contracts that expressly disclaim such a relationship. They also claimed that, even if such a relationship existed, Wholesale acted outside its authority by illegally recording the calls. Still, Wells Fargo and Priority acknowledged that if the court had ruled in their favor on vicarious liability, Wholesale would have been the sole defendant.

Bottom Line: Wells Fargo denied the allegations against them.

Document: Motion

Tags: Banking Docket
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