With regard to customer abuses involving bank accounts, mortgages, and auto loans—some of which occurred as recently as this year—Wells Fargo and the Consumer Financial Protection Bureau reached a $3.7 billion settlement.
According to a statement from the Consumer Financial Protection Bureau, the business was forced to pay a record $1.7 billion civil penalty as well as more than $2 billion to 16 million customers. Many of the "necessary activities," according to the San Francisco-based bank, were already finished, it was stated in a separate statement.
According to the agency, "the bank's illegal behavior caused billions of dollars in financial harm to its customers and, for thousands of consumers, the loss of their homes and vehicles." The bank improperly allocated payments to auto and mortgage loans, wrongfully repossessed consumers' cars, and illegally charged fees and interest charges on the loans.
The extent of the malfeasance described by the CFPB demonstrates that Wells Fargo's customer service issues went far beyond the 2016 incident involving millions of bogus accounts. The fourth-largest U.S. bank by assets, Wells Fargo, has a very tiny Wall Street operation, which means that regular Americans are its main clientele, as opposed to rivals JPMorgan Chase and Bank of America.
Even recently, some of the problems persisted. The bank misapplied vehicle loan payments and committed other errors, some of which resulted in erroneous auto repossessions, from "at least 2011 until 2022," according to a consent decree. Additionally, according to the CFPB, the bank made mistakes in applications for mortgage modifications between 2011 and 2018.
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