‘Growing frustration’: US bank scandal threatens record fine

‘growing frustration’
US bank scandal threatens record fine

11/05/2022 09:49 AM

Wells Fargo is haunted by past scandals. And now it appears that the US Consumer Protection Agency is demanding more than a billion dollars to stop the investigations. In general, the fourth largest bank in the United States had to pay more than ten billion dollars.

US bank Wells Fargo is set to pay more than $1 billion in fines under pressure from the US Consumer Protection Agency (CFPB). This was reported by the financial news agency “Bloomberg”, citing people familiar with the matter. The report said the regulator’s request reflected growing frustration with the bank.

The amount will be the highest fine to be charged by the CFPB. Wells Fargo also holds the current record. In 2018, the fourth-largest bank in the United States agreed with the authority to pay $1 billion – but was allowed to reimburse half of it for another fine that the bank had to pay to another authority. However, all this is only a small part of the sanctions imposed in recent years. In the scandal surrounding fake customer accounts, the US Department of Justice in 2020 raised $3 billion. Altogether, the bank has had to pay more than ten billion dollars so far.

Wells Fargo has struggled in the wake of scandals since 2016. At the time, it emerged that California bank employees had opened a total of millions of fake bank accounts or applied for credit cards for years — without the knowledge or consent of the customers involved. This was intended to achieve the goals of Wells Fargo. Since then, two CEOs have been fired.

The bank’s current president, Charlie Scharf, took over the bank in 2019 and has tried to end ongoing legal disputes and lead the institute onto a calmer path. The CFPB wants to use the amount requested to settle a number of investigations in the areas of auto loans, mortgages and customer savings accounts.