CFPB Files Lawsuit against Fifth Third Bank for Opening Unauthorized Accounts
The Consumer Financial Protection Bureau has filed a lawsuit against Fifth Third Bank for allegedly opening accounts without customer consent. The Bureau asserts the bank opened unauthorized credit card and deposit accounts, enrolled consumers in online banking without their consent, transferred money from existing accounts to unauthorized accounts, and activated lines of credit on customer accounts.
The CFPB alleges that Fifth Third Bank knew about employees opening unauthorized accounts in 2008, but they failed to implement strategies to stop those behaviors. The Bureau says that “for years and continuing through at least 2016,” the bank rewarded employees for cross-selling new products to existing clients. While employee incentives are not harmful on their own, this practice may have fueled the desire to open unauthorized accounts.
The Bureau is seeking compensation for affected customers, along with a civil money penalty.
Elements of this case are reminiscent of the Wells Fargo fake account scandal. Between 2011 and 2015, Wells Fargo employees opened over two million unauthorized credit card and checking accounts for existing customers. The CFPB requested a record-breaking $100 million fine, and other regulators filed for $85 million in fines against the bank. The final settlement amount was $142 million, which only equated to $35 per affected customer.