On Thursday, federal regulators with the Consumer Financial Protection Bureau — the agency established and created by Elizabeth Warren in 2011 under President Obama– revealed that 5,300 Wells Fargo employees had been fired after stealing the identities of customers and opening 1.5 million ghost accounts. According to the regulators, the scam dates back to 2011 and the bankers were committing the fraud in order to collect millions of dollars in fees and bonuses. CNN Money reports:
The way it worked was that employees moved funds from customers’ existing accounts into newly-created ones without their knowledge or consent, regulators say. The CFPB described this practice as “widespread.” Customers were being charged for insufficient funds or overdraft fees — because there wasn’t enough money in their original accounts.
Additionally, Wells Fargo employees also submitted applications for 565,443 credit card accounts without their customers’ knowledge or consent. Roughly 14,000 of those accounts incurred over $400,000 in fees, including annual fees, interest charges and overdraft-protection fees.
The CFPB has now handed down the largest fine in their history. Wells Fargo must pay $185 million in fines and “full restitution” to its customers ($5 million). The bank released a statement saying,”We regret and take responsibility for any instances where customers may have received a product that they did not request.” In addition to the fines, the bank will have to change its internal oversight and sales practices.
The victims of the fraud, however, say that the trust they put into the bank has been irrevocably broken.
“I didn’t sign up for any bloody checking account,” Kennedy, who is 57 years old, told CNNMoney. “They lost me as a banking customer and I have warned family and friends.”
As a Wells Fargo customer, I agree. We expect that our money will be safe when we deposit it into the bank and in this case not only did the bank steal millions of dollars from its customers, they stole their identities as well. And this wasn’t just a crime perpetrated by a couple employees, it was widespread and went on for years. While it is good news that the Obama Administration cracked down on the bank and fined them, the 5,300 employees who committed this fraud should be in prison.
If an average American citizen stole the identity of a stranger and opened bank accounts and credit cards, they would be charged with a felony. Somehow, though, when Wall Street steals our money and identities they get off with a fine. That, right there, is the reason why so many Americans are pissed off. We are sick and tired of banks swindling us and never being held criminally accountable for their actions. Hopefully, state attorneys across the country start charging these thieves for their crimes.
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