Because of illegal additional payments, customers lost their cars or even their houses. Authorities subsequently sentenced the US bank Wells Fargo to fines and billions in compensation. Just under three years ago, the bank had to pay around three billion dollars for illegal practices.
The US bank Wells Fargo has to pay a total of 3.7 billion dollars (3.5 billion euros) in fines and refunds to customers for a series of legal violations. The US Consumer Finance Agency (CFPB) said the bank, which has been hit by scandals in the past, is guilty of "illegal" activities.
For example, Wells Fargo charged illegal fees and interest on loans for car purchases and ultimately confiscated cars from customers. With eleven million customer accounts, this led to a total loss of 1.3 billion dollars. The bank is also said to have unlawfully refused to make changes to real estate loans, which in some cases resulted in clients losing their homes. Wells Fargo is also said to have charged illegal overdraft fees.
The CFPB imposed a $1.7 billion civil penalty and ordered the San Francisco, California-based bank to repay more than $2 billion to affected customers who accounted for a total of 16 million accounts with the bank.
CFPB chief Rohit Chopra said Wells Fargo had repeatedly violated the law, "harming millions of American families." The billions in fines that have now been imposed are an "important first step towards accountability and long-term reforms for this repeat offender".
Wells Fargo CEO Charlie Scharf said the agreement reached with the CFPB is a "milestone in our work to transform Wells Fargo's practices and put these issues behind us." A spokeswoman for the bank said Wells Fargo has already repaid most of the $2 billion to customers.
The big bank has repeatedly made negative headlines in the past. In 2016, for example, it became known that Wells Fargo employees had opened millions of false bank accounts or applied for credit cards for customers without their knowledge. This was intended to meet Wells Fargo targets. In that scandal, the bank settled with the Justice Department in February 2020 to pay a $3 billion fine.
