The 3rd biggest bank in the US, Wells Fargo with trillion in assets will pay a settlement of $575 million. This fine comes after the bank admitted to systematically scamming its customers for 15 years. This news comes months ironically after the bank stated that Bitcoin was too risky to invest in.
Wells Fargo, after the nationwide investigation carried out, admitted that over 3.5 million unauthorized sham bank accounts and credit cards accounts were opened by its employees in different customer names between 2002 and 2017.
Wells Fargo also charged its clients illegally for different financial services and products they didn’t sign up for like collateral protection insurance and life insurance policies on auto loans.
The employees of this bank claimed to have participated in this fraud for fear of losing their jobs and not meeting the sales goals set by Wells Fargo.
How Gets This Settlement Fine?
All 50 states in the US will receive the settlement fine. A consumer restitution review program will also be opened by Wells Fargo to ensure that all customers that have been illegally charged for unauthorized services get reimbursed
According to the recent securities filing, Wells Fargo will still face investigations by the SEC and the Department of Labor after settling with the Consumer Financial Protection Bureau. This bank has racked overby$2 billion in files since 2016 when it’s fake accounts scandal broke the news.
California attorney general Xavier Becerra torched Wells Fargo for its gross violation of consumer protection laws.
Wells Fargo banned their customers from buying cryptocurrency with their credit cards in June 2018. This ban occurred when the Bitcoin and cryptocurrency market, in general, was going into overdrive.
The high profile bank released a statement mentioning the multiple risks involved with investing in Bitcoin due to its volatility nature as the reason behind the ban.
A representative of the bank stated that the customers of the bank could no longer make use of their credit card to purchase cryptocurrency. They stated the ban was because they have to remain consistent across all their enterprise.
Cryptocurrency enthusiasts believe that this recent banking scandal is another example that puts the spotlight on the failures if centralized financial institutions.
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