Wells Fargo Bank Fined $100 Million for Illegal Practices


Employees had also filed thousands of credit applications fraudulently.

In some cases, Wells Fargo employees even created fake email addresses to sign up customers for online banking services.

According to Wells Fargo, leadership was aware that their employees were occasionally committing these crimes and had been firing offending employees over the last several years, apparently without informing their customers.

Wells Fargo said 5,300 people have been fired over this, although that doesn't appear to include senior management. Consumers are not required to take any action to get refunds to which they are entitled.

The bank did not admit any wrongdoing in the settlements, but it apologized to customers and announced steps to change its sales practices.

She said many banks have turned to account fees as a primary source of revenue from consumer banking since the recession, and that the incentives to find ways to charge fees go beyond Wells Fargo.

"Employees misused consumer names and personal information to create new checking and credit card accounts to inflate their sales figures to meet their sales targets and claim higher bonuses", he added.

Wells Fargo said it has refunded $2.6 million to affected customers for monthly maintenance fees, insufficient fund fees, overdraft charges and other fees paid.

Workers created more than 1.5 million fake bank deposit accounts and an additional 565,000 phoney credit card accounts.

"We regret and take responsibility for any instances where customers may have received a product that they did not request", Wells Fargo said in a release. "Our entire culture is centered on doing what is right for our customers".

Given that Wells Fargo (WFC) emerged from the Great Recession with relatively clean hands, it is particularly shocking that the bank has found itself embroiled in a scandal.

Wells Fargo has also refunded $2.5 million to customers and agreed to hire an independent consultant to review its procedures. The average was about $25 for each account.

Wells Fargo (NYSE:WFC) has been fined almost $185 million for alleged illegal practices involving account openings. The federal agencies conducted their own investigations into the bank's sales.

As a result of the illegal account openings, Wells Fargo has been ordered to pay a $100 million fine to the CFPB - the largest penalty the federal consumer watchdog has ever imposed.



Other news