Wells Fargo, a titan of the American financial industry, has agreed to pay $3.7 billion to resolve loan breaches, the highest fine ever levied against a bank.
The bank has been charged with defrauding customers by improperly applying overdraft fees to savings and checking accounts and charging unauthorised fees and interest on vehicle loans and mortgages.
The Consumer Financial Protection Bureau (CFPB) imposed a $1.7 billion fine and a $2 billion consumer repayment order on Wells on Tuesday.
The bank’s unsavoury behaviour, which affected more than 16 million consumers, was accused by the bureau.
In a conference call with reporters, CFPB Director Rohit Chopra stated, ‘simply put : Wells Fargo is a corporate recidivist that puts one out of three Americans at risk for possible harm.’
He said that the bank’s behaviour prompted the regulators to take additional actions against Wells Fargo that go beyond the $3.7 billion in fines and penalties.
In a statement, Wells Fargo CEO Charles Scharf said that the agreement with the CFPB is part of an effort to ‘transform operating practices at Wells Fargo and to put these issues behind us.’
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