updated October 8, 2017
Wells Fargo paid out money for bad behavior in the past and Wells Fargo may owe you money again. Why? Because the friendly person in the Wells Fargo branch neglected to tell you that, or she, opened a credit card in your name. The bank recently announced it discovered an additional 1.4 million accounts affected bringing the total to 3.5 million.
That stunt added to the employee’s bonus and cost you fees you didn’t want and might not have even realized you had to pay. They did this from January 2009 to September 2016.
Employees opened these 3.5 million accounts, without approval, for people who already banked with them and didn’t ask for new accounts or credit cards. That gave the employees extra cash in bonuses, while consumers ended up with unauthorized charges on their accounts.
They dishonestly created false email accounts for consumers so that the new accounts would get approved without a hitch.
Consumer Financial Protection Bureau (CFPB) Director Richard Cordray said, “Because of the severity of these violations, Wells Fargo is paying the largest penalty the CFPB has ever imposed,”as the result of a settlement.
Wells Fargo’s former CEO John Stumpf told members of the Senate Banking Committee that he was “deeply sorry” and that he took “full responsibility” for the unethical behavior. Stumpf “retired” in October 2016.
But come on. Who was minding the store?
Stumpf blamed about 5,300 employees for the behavior that cost customers money. He said they’d been fired. But former employees said they felt pressured from higher-ups to bend the rules.
The current C.E.O., Tim Sloan said in September 2017, “I want to assure you that we will take swift action to make things right for every a affected customer. We will issue refunds, provide assistance correcting credit reporting, and compensate customers for broader financial impacts.” And we entered into a $142 million settlement agreement to compensate eligible customers.
Actually, Wells Fargo will pay more than $185 million dollars in fines and penalties. A $100 million fine goes into the CFPB’s Civil Penalty Fund, which pays victims restitution for financial frauds.
But Wells Fargo will also refund, or has already, at least $2.5 million to consumers who found their accounts manipulated. In addition it will pay $35 million to the U.S. Comptroller of the Currency and $50 million to the county and city of Los Angeles, which sued the bank along with CFPB.
Does Wells Fargo owe you money?
If Wells Fargo owes you money under the settlement, it is required to reach out to you. It needs to do the work.