Breaking News

Wells Fargo Discloses More Fake Accounts
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading...

Wells Fargo

Summary: Wells Fargo admitted that 3.5 million fake accounts were created by employees trying to meet unrealistic sales goals. 

The number of fake accounts Wells Fargo employees created in an elaborate scheme is higher than originally reported. According to Fox News, the scandal may have affected 3.5 million customers instead of the 2.1 million originally reported.

  
What
Where


“We apologize to everyone who was harmed by unacceptable sales practices that occurred in our retail bank,” Wells Fargo CEO Tim Sloan said.

On Thursday, Wells Fargo disclosed the finding, and it said that it will provide additional millions to pay back the customers affected.

In September of last year, Wells Fargo acknowledged that its employees, faced with high sales quotas, opened millions of unauthorized accounts using real people’s data. The scheme began in 2009 and lasted for years, and some customers were charged fees in association with the fake accounts. The total of these fees meant that Wells Fargo raked in millions.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!




The government filed a lawsuit against Wells Fargo, and the bank subsequently changed its corporate structure and removed sales goals. The former CEO was ousted after the scandal and other executives in power at the time have also left the company.

A class-action lawsuit was settled due to the fake account scam, and Wells Fargo agreed to pay $142 million. They also have already paid $185 million in fines from the government.



According to Fox News, Wells Fargo hired a third party investigator, who uncovered 1.4 million additional fake accounts and 190,000 of those accounts accrued fees. The bank said that it will pay back $2.8 million in refunds and credits in addition to the $3.3 million it had already pledged to give back to affected customers.

Additionally, Wells Fargo said that 528,000 customers were enrolled in online bill pay without signing up for it, and these customers will receive refunds that total to almost $910,000.

Keefe, Bruyette & Woods told CNBC that the disclosure of the fake accounts will help the bank put the scandal behind it.

“The fact that the company has completed its comprehensive third-party account review and has communicated the finality of its customer remediation plans is a positive in our view,” KBW analyst Brian Kleinhanzl said. “The retail sales practice scandal settlement was announced nearly a year ago, and at this stage we now expect the trickle of new information to slow considerably.”

So far, Wells Fargo hasn’t seen the upside to its announcement. Since its disclosure, the bank’s shares fell by 0.8 percent, marking an already terrible year caused by its legal woes and bad reputation.

Earlier this month, the bank pledged to disclose all of its legal woes to regain the public’s trust.

“The disclosures included in our filing [Friday] reflect the company’s continued commitment to transparency. Our top priority is to rebuild trust, and this work includes an ongoing effort to identify and address other areas or instances where customers may have experienced financial harm. We remain focused on making things right for our customers, team members, community partners and shareholders and on building a better Wells Fargo,” the bank said in early August.

What do you think of Wells Fargo? Let us know in the comments below.



 

RELEVANT JOBS

Entry-Level Paralegal

USA-FL-Boca Raton

About us Law Office, where personal injury deserves personal attention Looking for an entry-le...

Apply now

Transactional Attorney

USA-TX-Amarillo

Brown & Fortunato, P.C. has a position for an attorney with a minimum of 2 to 5 years of transaction...

Apply now

Senior Healthcare Attorney

USA-TX-Amarillo

Brown & Fortunato, P.C.\'s Health Care Group, which currently includes sixteen lawyers who exclusive...

Apply now

Senior Litigation Attorney

USA-TX-Amarillo

Brown & Fortunato, P.C. has an opening for a litigation attorney with eight or more years of experie...

Apply now

BCG FEATURED JOB

Locations:

Keyword:



Search Now

BCG Attorney Search In-House Counsel

USA-CA-Los Angeles

BCG Attorney Search In-House Counsel We are a Legal Employment Company located in California with o...

Apply Now

FDA Regulatory Attorney

USA-MA-Boston

Boston office of a BCG Attorney Search Top Ranked Law Firm seeks FDA regulatory attorney with 3-4 ye...

Apply Now

Foreclosure/Bankruptcy Associate Attorney

USA-CA-Temecula

Temecula office of our client seeks associate attorney with preferably 2 years of experience working...

Apply Now

SEARCH IN ARCHIVE

To Top