San Francisco’s Wells Fargo Bank Is Still Dealing With Ethical Issues

Wells Fargo

Banks are part of the foundation for ethical standards. But when Wells Fargo Bank got caught creating sham accounts, the gatekeeper title went out the ethical window. In the 2016 settlement with bank regulators, Wells Fargo executives said they created about two million phony accounts for customers without their permission. That admission was enough to fire the chairman and CEO of the bank, John Stumpf. The scandal also prompted several bank reforms and the removal of the aggressive sales goals that were the catalyst for the bank’s missteps.
But just a year after Wells Fargo went through that shameful and unethical situation, there are still rumblings that the bank is charging customers improper fees. Charging fees on closed accounts due to a death or to a legal incompetence ruling is still going on. And the bad news is this improper fee charging thing is not new. It’s been going on for more than a year, according to an internal bank report. The report found 3.5 million sham accounts, and a recent audit shows Wells Fargo is still uncovering unethical practices. Bank analyst Bert Ely thinks the sham practices are expanding, and that opens the door for more internal changes.
In 2016, Wells Fargo admitted their mistakes, and bank executives agreed to pay $185 million in penalties and fees, according to the Los Angeles city attorney’s office. Wells Fargo was doctoring their books for at least two years before City Attorney Mike Feuer filed a 2015 lawsuit.
In July 2017, the bank said it would pay $80 million in refunds to thousands of auto-loan borrowers who had to pay for the bank’s auto coverage even though those people had their own car insurance. Plus, the Consumer Financial Protection Bureau is investigating the alleged improper bank fees that mortgage borrowers had to pay because their application was on hold for some reason.
And to make matters worse, there are other lawsuits that allege the bank changed the terms of mortgage loans for people who are bankrupt and for making customers sign up for unauthorized life policies. The bank was overcharging small businesses for debit and credit card processing services.
Wells Fargo executives claim they are fixing all of those issues, but it will take time to weed out all the unethical practices. Some employees say the executives are finally facing the complaints, and that is a step in the right direction.


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