Wells Fargo agrees to $3.7 billion settlement with CFPB over consumer abuses

Wells Fargo has agreed to a 3.7 billion dollar settlement with the Consumer Financial Protection Bureau over customer abuses, including abuses related to checking accounts and mortgages. Some of the misconduct occurred as recently as this year. The company was ordered to pay a record $1.7 billion civil penalty and more than $2 billion to customers with 16 million accounts, the CFPB said in a statement. The San Francisco-based bank said in a separate statement that many of the “required actions” tied to the settlement were already completed.

“The bank’s illegal conduct led to billions of dollars in financial harm to its customers and, for thousands of customers, the loss of their vehicles and homes,” the agency said in its release. “Consumers were illegally assessed fees and interest charges on auto and mortgage loans, had their cars wrongly repossessed, and had payments to auto and mortgage loans misapplied by the bank. The scope of wrongdoing detailed by the CFPB shows that Wells Fargo had problems servicing customers well beyond its 2016 scandal involving millions of fake accounts. Unlike rivals JPMorgan Chase and Bank of America, Wells Fargo, the fourth-biggest U.S. bank by assets, has a relatively small Wall Street business, meaning that ordinary Americans are its bread-and-butter customer. Some of those issues continued until recently. From “at least 2011 through 2022,” the bank misapplied auto loan payments and made other mistakes, some of which led to improper auto repossessions, according to a consent order. And from 2011 through 2018, the bank made errors in mortgage modification applications, the CFPB said.