A slew of new revelations threaten the firm’s reputation once more
Even after a review that unearthed millions of fake client accounts, Wells Fargo’s woes seem to be far from over.
According to a report from Bloomberg, the bank has updated the estimated number of fake debit and credit accounts from two million to around 3.5 million, reported Financial Advisor IQ. An outside review of over 165 million deposit and credit-card accounts spanning January 2009 to September 2016 resulted in the new estimate.
But investigators hired by Wells Fargo’s board said executives actually discovered the practice and began terminating the employees involved in 2002. The discovery that the review didn’t go as far back as the beginning could jeopardize the pending settlement of a US$142-million suit holding the bank liable for millions of fake accounts opened beginning May 2002.
CEO Tim Sloan has told reporters that the review didn’t go back that far because “the quality of the data tends to decline a bit.” Bloomberg reported that the bank refunded US$3.4 million aside from the US$3.3 million it had originally given back to affected clients. Counting the complaints and mediation costs it has covered, Wells Fargo said that it has already paid back or is paying back US$10.7 million to its clients.
The review has also uncovered around 528,000 possibly unauthorized enrolments in online bill-pay, resulting in US$910,000 worth of fees that the bank said it’ll pay back.
The firm is also getting hit with other scandalous revelations. A former Wells Fargo mortgage loan officer has filed a lawsuit in North Carolina claiming she was sexually harassed by her manager, and that the bank did not respond to complaints she had filed.
A former loan officer at the bank is also accusing its Beverly Hills branch of unfairly hiking up refinancing deals, according to the New York Post. According to the whistleblower, clients were regularly persuaded to pay up to 0.25% more interest to avoid fees for delays in mortgage-refinancing processing — delays which were typically caused by the loan officers themselves.
The bank stands accused of engaging in other questionable practices, including inconveniencing clients by freezing or closing real accounts; forcing almost 250,000 customers into delinquency by pushing unnecessary auto insurance on them; and overcharging its merchant credit card clients.
For more of Wealth Professional's latest industry news, click here.
Related stories:
Advisor sues former firm over smear campaign
How a global bank scandal has changed an industry
According to a report from Bloomberg, the bank has updated the estimated number of fake debit and credit accounts from two million to around 3.5 million, reported Financial Advisor IQ. An outside review of over 165 million deposit and credit-card accounts spanning January 2009 to September 2016 resulted in the new estimate.
But investigators hired by Wells Fargo’s board said executives actually discovered the practice and began terminating the employees involved in 2002. The discovery that the review didn’t go as far back as the beginning could jeopardize the pending settlement of a US$142-million suit holding the bank liable for millions of fake accounts opened beginning May 2002.
CEO Tim Sloan has told reporters that the review didn’t go back that far because “the quality of the data tends to decline a bit.” Bloomberg reported that the bank refunded US$3.4 million aside from the US$3.3 million it had originally given back to affected clients. Counting the complaints and mediation costs it has covered, Wells Fargo said that it has already paid back or is paying back US$10.7 million to its clients.
The review has also uncovered around 528,000 possibly unauthorized enrolments in online bill-pay, resulting in US$910,000 worth of fees that the bank said it’ll pay back.
The firm is also getting hit with other scandalous revelations. A former Wells Fargo mortgage loan officer has filed a lawsuit in North Carolina claiming she was sexually harassed by her manager, and that the bank did not respond to complaints she had filed.
A former loan officer at the bank is also accusing its Beverly Hills branch of unfairly hiking up refinancing deals, according to the New York Post. According to the whistleblower, clients were regularly persuaded to pay up to 0.25% more interest to avoid fees for delays in mortgage-refinancing processing — delays which were typically caused by the loan officers themselves.
The bank stands accused of engaging in other questionable practices, including inconveniencing clients by freezing or closing real accounts; forcing almost 250,000 customers into delinquency by pushing unnecessary auto insurance on them; and overcharging its merchant credit card clients.
For more of Wealth Professional's latest industry news, click here.
Related stories:
Advisor sues former firm over smear campaign
How a global bank scandal has changed an industry
