Wells Fargo Fake Bank Account Scandal Grows
The scandal of employees at Wells Fargo creating 2.1 million fake bank accounts and credit card numbers to boost sales figures has just gotten bigger, reports Paybefore sister publication Banking Technology.
After an expanded third-party review of retail banking accounts dating back to the beginning of 2009, Wells Fargo reveals that the number is in fact 3.5 million accounts.
As reported last year, the bank was fined $185 million, including a record $100 million by the Consumer Financial Protection Bureau (CFPB). Wells Fargo also fired at least 5,300 employees who were involved in the shady deals. In March, Wells Fargo announced it would pay $110 million to settle a class action lawsuit brought by U.S. consumers over the scandal.
In the latest development, Wells Fargo used a third-party firm. The latter reviewed analyzed consumer and small business checking, savings, and unsecured credit card and line of credit account data to identify potentially unauthorized accounts.
Wells Fargo says the original account analysis reviewed 93.5 million current and former customer accounts opened in an approximately four and half year time period—from May 2011 through mid-2015—and identified approximately 2.1 million potentially unauthorized accounts.
The expanded analysis reviewed more than 165 million retail banking accounts opened over a nearly eight-year period—from January 2009 through September 2016—and identified a new total of approximately 3.5 million potentially unauthorized consumer and small business accounts.
The bank reveals a whole swathe of numbers—but the bottom line is that the original figures were not correct.
In terms of remediation, Wells Fargo says in the coming weeks it will be taking steps to compensate its retail and small business customers.
These steps include beginning communications associated with the company’s $142 million class action settlement agreement (Jabbari v. Wells Fargo); compiling a list of customers who complained about an unauthorized account that was opened without their consent; and continuing to offer free mediation services to customers.
So far it has provided more than $3.7 million in refunds and customer credits connected to the drama.