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Incentive program costs Wells Fargo $185 M in CMPs
Wells Fargo Bank, N.A., will pay civil money penalties totaling $185 million and make about $2.5 million in restitution payments for failing to monitor and control a cross-selling incentive program. The CFPB, OCC and the Office of the Los Angeles (California) City Attorney announced on Thursday that they have imposed monetary penalties of $100 million, $35 million and $50 million, respectively, on the bank. The bank encouraged sales of new accounts and services in a program that established sales goals and bonus incentives, and a widespread employee practice developed that boosted sales figures by opening deposit and credit card accounts without customer authorization. The bank determined that as many as two million accounts were opened that may not have been authorized, and stated that about 5,300 employees involved in the scheme have been fired "over the last few years."
The CFPB found the bank's actions to be unfair and abusive under the Consumer Financial Protection Act of 2010. The OCC found the actions to be unsafe and unsound practices. The City of Los Angeles settled a 2015 suit brought against the bank alleging violations of California's Unfair Competition Law.
For more on this story, see "Wells Fargo sales incentives lead to $185M in CMPs," in our Penalties pages.