Wells Fargo Increases Class Action Settlement to $142 Million
Wells Fargo has increased its class action settlement for unauthorized account creation to $142 million, up from the $110 million announced in late March. The settlement now covers a new group of customers, with accounts dating back as far as May 2002.
When news first broke that Wells Fargo employees had opened nearly two million fake credit card and checking accounts, the company was hoping to settle out of court. They faced multiple lawsuits throughout the country, but they eventually followed through with the claims in the Northern District of California. This settlement should cover most of the customers who have already filed claims.
In November 2016, Wells Fargo paid the Consumer Financial Protection Bureau $185 million in fees and reimbursements. Since then, the company has issued $180 million in clawbacks and pay reductions from former executives, and have fired over 5,300 employees linked to the scandal. The bank will soon launch a new ad campaign to highlight their work to rectify this situation and prevent unauthorized account creation in the future.
“On our journey to rebuild trust, we want to ensure our customers feel confident that we have heard their concerns about retail sales practices, which includes offering them numerous opportunities for remediation,” said Tim Sloan, the new President and CEO at Wells Fargo, in a statement.
The reimbursements under this updated settlement will cover fees incurred from fake accounts and any damage that occurred to a person’s credit. The reimbursements will be set at flat rates based on the amount of damage customers experienced.