On Thursday, Wells Fargo made headlines for how 5,300 of its employees had created over 2 million fake bank accounts since 2011.
The revelation came from the Consumer Financial Protection Bureau (CFPB), which said that the accounts levied unwarranted fees onto customers. The accounts were presumably created because they allowed Wells Fargo employees to increase their sales figures, earning them more money.
Wells Fargo confirmed to the press that the guilty employees have been fired, either now or over the past few years. Many employees created phony PIN numbers and fake email addresses to enroll real customers in new online banking services.
Typically, an employee would move funds from an existing customer’s account into a newly-created account, without informing or getting permission from the customer. This would cause the original accounts to become overdrafted or be charged for having insufficient funds.
In addition to the widespread opening of additional bank accounts, Wells Fargo employees submitted applications for 565,443 credit card accounts without asking for consent from the affected customers.
14,000 of these accounts incurred over $400,000 in fees, which included annual fees, interest charges, and overdraft protection fees.
Wells Fargo was slapped with $185 million in fines by the CFPB from the ordeal, the largest penalty ever dealt by the CFPB. They will pay an extra $5 million to refund affected customers.
Despite its size, some have wondered if the penalty is enough, particularly in light of the fact that Wells Fargo is worth over $250 billion, making it the largest bank in America.
In total, Wells Fargo has 265,000 employees, which suggests that an overwhelming majority of employees were not involved.
