The Consumer Financial Protection Bureau (CFPB) fined Wells Fargo $100 million for the alleged secret opening of unauthorized deposit and credit card accounts.
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As of 2015, Wells Fargo is the second-largest banking institution in New Jersey, behind Bank of America, with an 11.57 percent deposit market share and almost 300 offices, according to the Federal Deposit Insurance Corporation.
Making matters worse, the Wells Fargo employees also submitted applications for 565,443 credit card accounts, all without their customers’ knowledge or consent. $5 million has been set aside for customer refunds. It also will pay $50 million to the City and County of Los Angeles, along with a $35 million penalty to the Office of the Comptroller of the Currency. Discovered between 2011 and 2015 were millions of unauthorized bank and credit card accounts.
Wells Fargo is preparing to roll out a huge apology tour after an investigation uncovered 5,300 employees were the source of over 2 million fake accounts. The bank has agreed to refund about $2.6 million in fees that might have been inappropriately charged.
In addition, the Sioux Falls, S.D. -based bank says it is taking steps to keep this type of scheme from occurring again, noting that it will now send a customer an email confirmation shortly after a deposit account is opened.
The San Francisco-based bank will also pay $50m to the City of Los Angeles, which had filed suit a year ago, accusing the bank of pressuring employees into fraudulent behavior, such as opening fictitious accounts.
A spokeswoman for Wells Fargo did not immediately respond to a request seeking the total number of New Jersey customers whose accounts were affected. “Consumers must be able to trust their banks”.
To summarize the case, the fake accounts were opened by the bank’s employees to meet their sales targets so that they could get their bonuses. However, at Wells Fargo, when we make mistakes, we are open about it, we take responsibility, and we take action.
Wells Fargo’s website lists no banks in West Virginia, with only one in western Ohio.
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In a statement to Team 10, Wells Fargo said: “Wells Fargo reached these agreements consistent with our commitment to customers and in the interest of putting this matter behind us”.
