Two real-estate appraisers have filed a proposed class-action lawsuit against Wells Fargo and Rels Valuation, an appraisal management service, claiming the 2 organizations pressured and intimidated appraisers to deliver artificially inflated home appraisal values to help close loans and increase profits.
The suit claims that beginning in 2004 Wells Fargo and Rels colluded to punish appraisers who refused to inflate appraisals by denying them future appraisal work.
Rels is one of the largest appraisal management companies in the country, acting as an intermediary between banks and appraisers. Appraisers, by law, are intended to be independent and autonomous from the influences of others, but according to the complaint are compelled to do the bidding of Rels, and through them Wells Fargo.
Plaintiffs Don Pearsall and Timothy Savage both claim Wells Fargo tried to strong-arm each of them into inflating appraisal values, violating the laws and regulations of the Uniform Standards of Professional Appraisal Practice (USPAP). The USPAP rules clearly state an appraiser must not accept an assignment that includes the reporting of predetermined opinions and conclusions - something the lawsuit claims Rels does on a regular basis.
According to the compliant, Rels and Wells Fargo have given appraisers predetermined comparable properties to base appraisals, further compromising the appraisers' independence.
Pearsall, a long-time appraiser, completed an appraisal for Wells Fargo and Rels in 2007. After submitting his report, Rels asked that he alter the report to reflect the company's desired views on the property. After refusing, the suit claims Rels blacklisted Pearsall, stripping him of a large portion of his income.
Timothy Savage, an appraiser in Vail, Colorado, also submitted 2 appraisals to Rels in 2009, which the company rejected, asking him to increase the appraisal values. After refusing, Savage received a letter from Rels informing him that he is no longer included on the approved panel of appraisers, the suit claims.
The lawsuit seeks to represent all state-licensed or state-approved appraisers nationwide who've been removed as an approved appraiser by Wells Fargo or Rels Valuation. The suit asks for treble damages and is the first lawsuit filed on behalf of appraisers against Wells Fargo and Rels.
