US bank Wells Fargo fined $185m for opening illegal accounts


via BBC News – Business http://bbc.in/2cGH08w

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A man walks past a Wells Fargo branch

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Ben Margot

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Wells Fargo has been fined $185m

The US’ biggest bank Wells Fargo has been fined $185m for illegally opening accounts to boost sales targets.

The cash will go to regulators while the bank will also hand back $5m to customers.

It was found guilty of “widespread illegal practice” around account openings, sales targets and compensation incentives.

“We regret instances where customers may have received a product that they did not request,” the bank said.

The US Consumer Financial Protection Bureau (CSFB) announced the fine and said the bank must also hire an independent consultant for a review.

“Because of the severity of these violations, Wells Fargo is paying the largest penalty the CFPB has ever imposed,” said Richard Cordray, director of the regulator.

Its investigation found that to meet sales targets and possibly gain more compensation bank workers had “illegally” signed up customers for more than 2 million deposit and credit-card accounts.

Employees also issued debit cards without customers’ knowledge, even creating fake email addresses to unknowingly sign up consumers to online-banking services, the regulator said. Wells Fargo said it set up an independent review of its sales practices dating back to 2011 and had taken “disciplinary actions, including terminations of managers and team members who acted counter to our values”.