Another Wells Fargo bank scandal
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comes to an end with the payment of a huge fine. This time it is about the bank’s agreement to pay 1.7 billion dollars for a class action lawsuit and another 2 billion shekels for 16 million customers who were affected “by the many violations”, as announced by the Consumer Financial Protection Bureau (CFPB) in the USA. It is about “extensive mismanagement of car loans and mortgages , and also deposits”.
According to the bureau, Wells Fargo Bank “repeatedly illegally applied loan payments to mortgages and vehicle loans, incorrectly assessed fees and interest and mortgage, which also led to the foreclosure of vehicles. In addition, it illegally charged overdraft fees and performed other illegal actions that affected more than 16 million consumer accounts.”
Regarding home loans, the CFPB said the bank misinterpreted mortgage changes for seven years, causing some customers to lose their homes. The bank illegally charged overdraft fees, and in more than a million cases, it illegally froze consumer accounts “based on a determination of a faulty automatic filter.”
“Wells Fargo’s repeated and problematic conduct in violation of the law has harmed millions of American families,” said CFPB Director Rohit Chopra. “The CFPB is ordering Wells Fargo to return billions of dollars to consumers across the country. This is an important first step in long-term accountability and reform of this repeat offender,” he added.
The bank stated that the “settlement is wide-ranging” and will solve problems that still remain for several years, while at the same time the bank has “accelerated the corrective and corrective actions” since 2020. The CEO of Wells Fargo, Charlie Scharf, said that the settlement is “an important milestone in our work To change the operating methods of Wells Fargo and put these issues behind us.” The CEO came to the bank in 2019, while these offenses are attributed to the years 2016-2018.
But these were only some of the offenses committed by the bank. In 2016, it was discovered that the bank had opened millions of fake accounts, and this is only part of the problems the bank had, which led to the removal of two CEOs and other penalties, including a decision by the American central bank, the Federal Reserve, to limit the bank’s assets. In fact, ‘service errors by the bank Happened at least between 2011 and even the last year.
The bank will report its financial results for the fourth quarter on January 13.
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