Wells Fargo Coughs Up $37 Million to Resolve DOJ Claims it Defrauded Currency Customers
Posted on 09/28/2021
Running into more trouble with the U.S. federal government, San Francisco-based Wells Fargo paid US$ 37 million to settle a government lawsuit accusing the bank of defrauding hundreds of commercial customers. Wells Fargo has a track record of unethical and illegal behavior and was mired in the 2016 fake accounts scandal. Earlier in September 2021, Wells Fargo was hit with a US$ 250 million fine from a resolution of a Consumer Financial Protection Bureau consent order.
According to the U.S. Justice Department lawsuit, Wells Fargo informed its commercial customers that they were being charged certain fixed rates, but then incentivized salespeople to “overcharge FX customers”.
Wells Fargo then concealed the overcharges from customers. The overcharges yielded millions of dollars in foreign exchange revenue to which the bank was not entitled to, according to the lawsuit. According to the DOJ, most of the settlement, US$ 35.3 million, is going as restitution to the overcharged customers.