Consumer complaint received 2025-01-27 00:00:00
Product: Mortgage — VA mortgage
Issue: Closing on a mortgage — Trying to communicate with the company to fix an issue with the loan closing
Company: WELLS FARGO & COMPANY
State: SC

Complaint narrative:
THIS COMPLAINT IS FOR XXXX XXXX XXXX, TRUSTEE FOR WELLS FARGO BANK , NATIONAL ASSOCIATION OR THE ASSIGNEE. I am writing to formally address serious concerns regarding the handling and status of my promissory note associated with my VA home loan, originated in 2019. My loan was financed with an amount of {$79000.00} at an XXXX of 4.75 %, serviced by XXXX XXXX XXXX XXXX XXXX, and XXXX XXXX. As the trustee, Wells Fargo Bank , National Association, plays a critical role in ensuring that all financial transactions are conducted within the scope of applicable laws, regulations, and the contractual agreements between the parties. 
Concerns Regarding the Promissory Note and Potential Security Fraud It has come to my attention that my promissory note, which should represent a simple financial transaction, appears to have been securitized and potentially monetized in a manner inconsistent with my understanding of its intended purpose. Specifically, under the principles of financial instruments and banking regulations, such notes are typically treated as deposits or collateral, which must be recorded accurately in accordance with applicable laws, including Federal Reserve regulations and guidelines. 
Furthermore, 31 CFR 357 establishes comprehensive guidelines for the management, transfer, and pledge of book-entry securities, which would include any assets tied to my promissory note. These regulations impose specific fiduciary duties on trustees to ensure that all securities transactions comply with federal standards, including : Pledge and Transfer Compliance : Ensuring that all pledges or transfers of the promissory note are conducted with the borrowers informed consent and in alignment with regulatory requirements. 
Recordkeeping and Transparency : Maintaining detailed records of all transactions involving the note and providing regular disclosures to relevant parties, including the borrower. 
Fiduciary Responsibility : Acting solely in the interest of the beneficiaries of the trust, which includes ensuring that all pooled assets meet eligibility criteria and regulatory standards. 
Relevant Provisions from Federal Reserve Act, Section 16 Section 16 of the Federal Reserve Act outlines key principles for the issuance and management of Federal Reserve notes. These provisions are directly applicable to the handling of promissory notes, which are treated as collateral for such issuances : 1. Section 16, Part 1 : Federal Reserve notes are issued against collateral, which may include promissory notes, drafts, and other obligations. This underscores the critical role of accurate classification and management of pledged assets to ensure compliance with federal guidelines.

2. Section 16, Part 2 : Only Federal Reserve Banks may issue notes backed by properly pledged collateral. This provision raises significant questions about how my promissory note was treated and whether the securitization process adhered to these requirements. 
Concerns About Conversion and Unauthorized Securitization Recent analysis suggests that promissory notes, including mine, may be endorsed in blank and subsequently converted into multiple marketable securities. These securities can then be pledged or sold to other entities, such as the U.S. Treasury or international exchanges, often without the borrowers explicit knowledge or consent. This practice, while potentially lawful when disclosed and managed properly, raises the following issues : Lack of informed consent from the borrower. 
Misrepresentation of the notes status and its subsequent use as collateral for further financial gain. 
Potential violations of 31 CFR 357 and Section 16 of the Federal Reserve Act regarding the proper management and classification of pledged assets.

Key Issues with Trustee and Servicer Roles in the Securitization Process 1. Securitization of the Promissory Note : The promissory note was pledged as collateral to secure my loan. However, it appears that the note may have been securitized, converted into a financial security, and monetized without my explicit consent. This raises questions about transparency and compliance with federal guidelines, including securities laws enforced by the Securities and Exchange Commission ( SEC ), 31 CFR 357, and Section 16 of the Federal Reserve Act.

2. Potential Security Fraud : The unauthorized securitization of my promissory note, if verified, may constitute security fraud under federal law. If any individual or entity within Wells Fargo Bank , National Association has engaged in actions inconsistent with SEC and 31 CFR 357 regulations, they may be held personally liable for these violations.

3. Trustee Responsibilities : As the Securitization Trustee, Wells Fargo Bank , National Association has a fiduciary duty to ensure the pooled assets backing the issuance of securities ( including my loan ) are compliant with federal and state laws. This includes monitoring the Servicers activities under the Pooling and Servicing Agreement ( PSA ). Specifically : o Ensuring compliance with Truth in Lending Act ( TILA ) disclosures, loan origination standards, and federal securitization guidelines. 
o Proper classification and valuation of assets pledged as collateral in accordance with Federal Reserve Operating Circular No. 10, 31 CFR 357, and Section 16 of the Federal Reserve Act.

o Addressing any mismanagement by the Servicer, including mishandling payments or failing to follow foreclosure protocols.

4. Servicer Oversight : The Servicer, tasked with loan administration and borrower interaction, reports directly to the Trustee. Any errors, including misapplied payments or inflated charges, reflect a failure in the Trustees oversight responsibilities. The Servicers role in managing escrow accounts, interacting with borrowers, and providing accurate data about the loan must also be reviewed. 
XXXX. Transparency in Reporting : I have not received clear documentation or annual reporting, which would include an account of how the promissory note and its associated funds have been managed or pledged. The Trustees fiduciary duties under 31 CFR 357 require regular disclosures to ensure trust integrity and compliance with federal regulations.

Request for Clarification and Action Given the above concerns, I respectfully request that Wells Fargo Bank , National Association, as trustee, provide clarification and detailed documentation addressing the following : 1. A full accounting of how my promissory note has been handled since the loan origination in 2019.

2. Confirmation of whether my promissory note has been securitized, monetized, or pledged as collateral for other financial transactions.

3. Identification of the individuals responsible for approving and executing the securitization or monetization of my promissory note, along with documentation of their compliance with SEC, 31 CFR 357, and Section 16 of the Federal Reserve Act regulations. 
4. Explanation of how the note aligns with Federal Reserve guidelines, specifically Operating Circular No. 10 and the Borrower-in-Custody ( BIC ) program, if applicable.

5. Details regarding the Servicers role in managing my loan, including any mismanagement or failure to comply with consumer protection laws ( e.g., TILA violations ).

6. Identification of any accounts or instruments created in connection with my promissory note, including any associated routing or account numbers.

7. Documentation of compliance with relevant laws and regulations, including but not limited to the Federal Reserve Act, SEC regulations, and 31 CFR 357. 
XXXX. Evidence of efforts to settle and close Account XXXX. XXXX in accordance with IRS directives. 
Conclusion I trust that Wells Fargo Bank , National Association, as a reputable trustee, will address these concerns with the utmost transparency and diligence. Please provide the requested information within 3 days of receipt of this letter. If additional time is required, kindly inform me in writing. 
Failure to provide a satisfactory response or evidence of compliance with federal laws and regulations may result in further action, including reporting to the SEC, IRS, and other relevant authorities. 
I appreciate your attention to this matter and look forward to your prompt response.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation