Sun, Aug 06, 2017 - Page 16 News List

Wells Fargo probe needs more time


Wells Fargo & Co is expanding an internal review of its sales practices and says the move could uncover significantly more accounts opened by bank employees without customers’ consent.

The San Francisco bank disclosed the broadened review in a filing on Friday with the Securities and Exchange Commission.

Wells Fargo has been trying to repair its reputation after admitting last fall that employees under pressure to meet aggressive sales targets opened as many as 2 million accounts without getting customers’ permission. The company ended up paying US$185 million to regulators and settled a class-action suit for US$142 million.

The lender is now expanding its review of customer accounts going back to 2009. Initially, it planned to review accounts going back to 2011.

It also expects to complete a review of potentially unauthorized accounts identified by a consulting firm.

“We expect that our review of the expanded time periods, which adds over three years to the initial review period of approximately four years ... may lead to a significant increase in the identified number of potentially unauthorized accounts,” the company said in the filing.

Wells Fargo projects that its review will be finished by the end of the third quarter. It does not expect any costs stemming from the review to have a significant impact on the company.

Last month, the company disclosed that about 570,000 customers were signed up for and billed for car insurance that they did not need or necessarily know about. Many could not afford the extra costs and fell behind in their payments. In about 20,000 cases, cars were repossessed.

The bank has agreed to pay US$80 million in refunds and account adjustments to customers.

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