Wells Fargo to Pay $3.7B Over Consumer Banking Violations
WASHINGTON — Wells Fargo has agreed to pay a total $3.7 billion to settle claims that it engaged in widespread banking violations over the last decade that harmed millions of consumers.
According to the Consumer Financial Protection Bureau, roughly $1.78 billion of the total will be collected as fines, and about $2 billion will be repaid to consumers as damages.
“Wells Fargo’s rinse-repeat cycle of violating the law has harmed millions of American families,” said CFPB Director Rohit Chopra.
“The CFPB is ordering Wells Fargo to refund billions of dollars to consumers across the country. This is an important initial step for accountability and long-term reform of this repeat offender,” Chopra said.
As recounted in a filing by the bureau, Wells Fargo misapplied customer payments on auto loans, wrongfully repossessed some borrowers’ cars and charged overdraft fees even when customers had enough money to cover purchases they made with their bank cards.
Wells Fargo stopped the conduct this year as part of a larger effort to clean up other abusive practices stretching back a decade, a filing by the agency said.
As part of its settlement, Wells Fargo has also been repaying customers, returning improperly charged fees and offering some financial relief to those whose finances and credit ratings were hurt by the bank’s practices.
“This far-reaching agreement is an important milestone in our work to transform the operating practices at Wells Fargo and to put these issues behind us,” said Charles Scharf, Wells Fargo’s chief executive, in a written statement.
Wells Fargo is “a different company today,” he added.