Wells Fargo Bank (WFC) must pay a Dallas woman over $8 million. Texas State Judge Emily Tobolowsky said that the bank defrauded Angela Militello in its role as trustee for a trust that family members set up for her when she became an orphan at the age of seven.
Militello contends that in 1999, a trust officer sent to her by the bank told her to set up a new account and gave her papers for establishing a revocable trust. After Militello filed for divorce in 2006, she asked the trust officer about withdrawing $200,000 from the trust to purchase a home for her and her child.
The trust officer gave her a check for that amount and a form asking for approval of the completed sale of a percentage of the assets in the trust. The remainder of assets was to be sold within a few months. Militello claims that Wells Fargo and a third party conspired to sell the assets in her trust at way below market value and fraudulently charge her tfor the property taxes after a buyer purchased the assets.
Last month, Judge Tobolowsky determined that Militello had been bilked of her funds.
She ruled against the bank on numerous causes of action alleged by Militello, including: common law fraud, statutory breach of fiduciary duty under the Texas Trust Code, common law breach of fiduciary duty, gross negligence, and negligence. The judge ordered Wells Fargo to pay Militello over $8 million, including $1 million for mental trauma, more than $1.5 million for losses, and $3.5 million in punitive damages.
The bank says it might appeal.
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Judge orders Wells Fargo to pay $8.6M for defrauding ailing Dallas woman, Bizjournals.com, July 9, 2015
Judge: Wells Fargo to pay $8M for fraud tied to trust set up when Dallas woman was orphan, The Dallas Morning News, July 10, 2015