(Legal Newsline) — The Consumer Financial Protection Bureau (CFPB) has
announced a $100 million fine against Wells Fargo.
allegedly allowed the widespread illegal practice of secretly opening up credit
card and deposit accounts in consumers’ names. Since employees received bonuses
for reaching certain sales targets and compensation incentives, they would purportedly
open accounts and fund them by transferring money from consumers’ authorized
accounts without knowledge or consent.
transactions often incurred fees that were forced upon the consumers. The CFPB alleged that, by Wells Fargo’s own analysis, employees opened more than 2 million deposit and credit card counts not authorized by consumers.
Fargo employees secretly opened unauthorized accounts to hit sales targets and
receive bonuses,” CFPB Director Richard Cordray said. “Because of the severity
of these violations, Wells Fargo is paying the largest penalty the CFPB has
ever imposed. [This] action should serve notice to the entire industry that
financial incentive programs, if not monitored carefully, carry serious risks
that can have serious legal consequences.”
to the $100 million fine, the bank will pay $35 million to the Office of the
Comptroller of the Currency, and another $50 million to the city and county of