Wells Fargo gets USD250M fine for failing to pay back hurt customers

WASHINGTON (AFP) – United States (US) bank Wells Fargo on Thursday was hit with a new fine – USD250 million for failing to meet requirements in an agreement to pay previously harmed customers.

The penalty was set by the Comptroller of the Currency (OCC), one of the main US banking sector regulators.

“Wells Fargo has not met the requirements of the OCC’s 2018 action against the bank. This is unacceptable,” said Acting Comptroller of the Currency Michael Hsu.

Wells Fargo admitted to opening 3.5 million fake accounts between 2002 and 2017, allowing its employees to earn bonuses related to the sale of new products, and charge unnecessary insurance premiums to more than half a million customers on their car loans.

In 2018, the OCC and the Consumer Financial Protection Bureau (CFPB) fined the California bank USD1 billion and ordered it to reimburse the harmed customers the amounts improperly taken, and to strengthen the bank’s risk management programme.

In addition to the penalty, Wells Fargo will face “limits on the bank’s future activities until existing problems in mortgage servicing are adequately addressed”, Hsu said.

People walking past the Wells Fargo sign. PHOTO: BLOOMBERG