Dillard's Sues Wells Fargo, Alleging Breach of Co-Branded Credit Card Relationship

Core Viewpoint - Dillard's has filed a lawsuit against Wells Fargo, claiming breach of a co-branded credit card agreement, resulting in significant financial losses for Dillard's [1][2]. Group 1: Lawsuit Details - Dillard's alleges that Wells Fargo's actions led to a loss of tens of millions of dollars due to the termination of their co-branded credit card relationship [1]. - The complaint states that Wells Fargo became an "unwilling and incapable partner" after regulatory issues arose, effectively abandoning the co-branded card market without notifying Dillard's [2]. Group 2: New Partnerships - In January 2024, Dillard's announced new credit card agreements with Citi and Mastercard, where Citi would acquire existing Dillard's credit card accounts and Mastercard would be the exclusive payment network for Dillard's co-branded cards [3]. - Dillard's President emphasized the importance of providing premium credit services to customers and expressed confidence in the new partnerships [4]. Group 3: Wells Fargo's Regulatory Challenges - Wells Fargo has faced ongoing regulatory issues since the "fake accounts" scandal in 2016, including an asset cap imposed by the Federal Reserve in 2018 [4]. - In April, Wells Fargo reported that the CFPB terminated a consent order related to its compliance risk management program, indicating progress in regulatory compliance [5].