The bank will pay $3bn to settle probes into its fake-accounts scandals – but the deal didn’t address scandals in its mortgage and auto-loan businesses
While Wells Fargo has settled major civil and criminal investigations into its sales practices, the banking giant and its former executives haven’t yet seen the last of their legal troubles.
Last week, Wells Fargo agreed to pay $3 billion to settle criminal and civil probes into its fake-accounts scandal. However, that deal didn’t address subsequent scandals involving the bank’s mortgage and auto-lending businesses, according to a Reuters report. In those scandals, Wells Fargo charged customers improper fees and signed them up for auto insurance they did not need.
The deal also didn’t rule out potential charges against individual executives, Reuters reported.
“The damage train for Wells Fargo may keep rolling along,” Erik Gerding, a law professor at the University of Colorado in Boulder, told Reuters.
The bank has weathered a string of scandals since the fake-accounts affair, in which millions of unauthorized customer accounts were opened by Wells employees, erupted in late 2016. The scandals have so far cost the bank billions in fines and settlements and led to the ouster of two CEOs, John Stumpf and Tim Sloan.
Last month, the Office of the Comptroller of the Currency banned Stumpf from working in the banking industry and fined him $17.5 million. At the same time, the OCC announced pending actions against several other former Wells Fargo execs, including Carrie Tolstedt, the former head of community banking at the center of the fake-accounts scandal.
Several former Wells Fargo executives are also reportedly under criminal investigation.
