Local News

Local attorney files suit against Wachovia

Posted January 15, 2010 6:59 p.m. EST
Updated January 15, 2010 7:38 p.m. EST

— A Raleigh attorney has filed a class-action federal lawsuit against the former Wachovia Securities over what he considers excess fees and profits by the company – now owned by Wells Fargo.

Gene Boyce, 77, claims the company violated its contract by profiting more than $250,000 through commission fees and dealer mark-ups from his $5 million investment in municipal bonds.

He signed an agreement to pay Wachovia a half-percent commission on the purchase.

Instead of buying the bonds and charging him the fee, he claims Wachovia bought the bonds, then marked them up, then sold them to him and tacked on the fee.

Boyce said he started hearing from other investors across the country after he was featured in a Forbes Magazine article.

"I just got the sense that I'm looking after people by not letting a big corporation get by with this sort of thing," he said.

Financial adviser Gerald Townsend believes most bond deals are fair, but he concedes there is less information available to consumers compared to stock purchases.

"To do it on both basis is sort of a double dip, and it's really not a fair way to do it," Townsend said. "It's bad PR. They don't need this kind of stuff. Our whole industry suffers."

Tony Mattera, senior vice president for Wells Fargo corporate communications said he cannot comment on the litigation but did say the company:

"Strives always to do what is in the best interests of our clients. In the securities industry, there is a process prescribed by our regulators for addressing investor grievances and we adhere to that process."