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When Donna and Diego Gomez spent almost $300,000 for a Miami condo earlier this year, the $2,200 in loan fees they paid to Wells Fargo Bank seemed excessive to them. The couple figured they weren’t the only bank customers who had overpaid fees. They’re the lead plaintiffs in a lawsuit against Wells Fargo Bank filed Friday in Miami-Dade Circuit Court that seeks class action status. The Gomezes contend the San Francisco-based bank set up contests called “Pick of the Pros” and “Play of the Week” to pay back business associates for referrals. And they believe a portion of their fees helped fund the kickbacks. That violates the federal Real Estate Settlement Procedures Act, the suit claims. Enacted in 1974, RESPA requires lenders to give consumers advance notice of settlement charges and bans kickbacks and excessive fees. The law also bans giving or receiving anything of value in exchange for referrals of settlement service business, such as title insurance and mortgage loans. The couple does not contend that the fees were undisclosed to them. “The issue is that money that went for this referral program, which we refer to as a kickback prize program, should have gone to lower their fees,” said the couple’s attorney, Jeremy Friedman of Downs Brill Whitehead & Sage in Coral Gables, Fla. Diego Gomez, who travels between Miami and New Jersey, did not return repeated phone calls. His wife, Donna Gomez, who lives in New Jersey, could not be reached for comment. Bank spokesman Kevin Waetke said the company has not received notice of the lawsuit and declined to comment. The couple paid $287,405 for a one-bedroom condo in the Club at Brickell Bay at 1200 Brickell Bay Drive in Miami. Wells Fargo financed $229,924 of the purchase price at an interest rate of 5.375 percent. After the couple closed on their condo purchase, Diego Gomez consulted with Friedman. Friedman, who has represented Gomez in business matters, researched the lender on the Internet. He discovered that Wells Fargo, through Gage Marketing, conducted national incentives contests for real estate salespeople, builders’ employees, accountants and attorneys. The winners got prizes ranging from DVD players and color TVs to trips to Hawaii and $25,000 cash. Friedman said Wells Fargo is under investigation for RESPA violations by the U.S. Department of Housing and Urban Development. He declined to state how he knows that. Bank spokesman Waetke said in a subsequent e-mail that the company is unaware of any HUD investigation of its Play of the Week program. He did not mention the Pick of the Pros contest and could not be reached again before deadline. HUD spokesman Brian Sullivan in Washington said the agency doesn’t discuss ongoing investigations. Wells Fargo was indirectly involved in the settlement of RESPA violations late last month involving Prudential Locations LLC, a Hawaiian real estate agency. According to a Sept. 20 HUD announcement, Prudential paid a $48,000 settlement over a rewards program for real estate salespeople who referred business to Wells Fargo Home Mortgage Hawaii LLC. A Prudential event called the First Annual Wells Fargo Friends Party was for salespeople who referred more than $1 million in mortgage business to Wells Fargo. Prudential awarded a three-year lease on a Mercedes-Benz, trips to Thailand, Las Vegas and San Francisco and restaurant gift certificates. “Wells Fargo Home Mortgage was not involved in the settlement between HUD and Prudential Locations, as neither Wells Fargo Home Mortgage nor its joint venture Wells Fargo Home Mortgage of Hawaii LLC participated in any of the activities that allegedly violated [RESPA],” Waetke wrote in the e-mail. HUD’s Sullivan said the agency has stepped up its RESPA enforcement efforts. During a series of summer roundtables hosted by HUD, attendees said buyers needed more certainty about the home-buying process. “If consumers knew what they were getting into earlier in the home buying or refinancing process, they could avoid things that later trigger enforcement activity,” Sullivan said. The agency is considering how to beef up rules to allow consumers to drive the process “instead of the cart pulling the horse,” he said. The Gomezes’ lawsuit is the second involving their Miami condo purchase. In July, they filed another lawsuit as a proposed class action in Miami-Dade Circuit Court alleging RESPA violations against the condominium and its developers, Tibor and Wayne Hollo. The suit contends buyers were required to buy title insurance through the South Florida Title Group, a title insurance company in Miami Beach. “We’ve alleged that notwithstanding any referral agreement, if there is one, they improperly required Gomez and other class members to use that title agency for title charges,” Friedman said. Gary Phillips of Phillips Eisinger & Brown in Hollywood, attorney for the Hollos and their development, is seeking dismissal. “We don’t believe it has any merit,” he said. The Gomezes “never requested to write their own title insurance. In cases where people did request that, it was allowed.” South Florida Title Group president Matthew Krieger did not return a phone call by deadline.

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