Challenging California's biggest banks, consumers have filed lawsuits accusing Bank of America Corp. and Wells Fargo & Co. of improperly collecting sales tax at the end of automobile leases, and claiming that Bank of America failed to adequately disclose certain fees at automated teller machines.
The suits, filed Tuesday in Los Angeles County Superior Court, seek certification as class actions representing customers throughout the state. Two suits demand unspecified damages for tens of thousands of Californians who have leased cars through the banks, while a third seeks the return of ATM fees to potentially millions of Bank of America customers.
San Francisco-based Wells Fargo said it didn't comment on litigation. A spokeswoman for Charlotte, N.C.-based Bank of America said lawyers hadn't studied the suits enough to comment.
Bank of America ATMs display a notice saying "fee may apply" when customers order statements, but state law requires notice of the actual fees, which are $3 for a complete statement and $1 for an abbreviated version, according to a suit filed by Pasadena lawyers Tina B. Nieves and Hector Gancedo. The suit said the bank also charged customers of other banks undisclosed fees of $1.25 for account balance inquiries.
Two additional cases take aim at the sales taxes on the termination fees that banks charge at the end of auto leases.
California regulations require leasing companies to charge state and local sales tax on regular lease payments, the suits said, but not on costs "incurred in disposing of the leased property at expiration or earlier termination of the lease."
When Marc I. Lavin of Los Angeles turned in his leased Audi in October 2002, Wells Fargo charged him $20.63 in sales tax on top of the $250 termination fee, one suit says.
Bank of America also charged $20.63 in sales tax on top of a $250 termination fee when Michael Brown of Los Angeles returned his Chevrolet in July 2003, according to the other suit.
"One major question will be what happened to the money," said Andrew H. Selesnick of Encino, one of the lawyers who filed the suit. "Will they be able to show us they remitted it to the state or did they stick it in their pockets as profit?"
Selesnick said some other auto-leasing companies, including those for Volvo and Mercedes-Benz cars, didn't charge California sales tax on termination fees, also called disposition fees.