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WELLS FARGO ACCUSED IN A NEW FAKE ACCOUNTS SCANDAL

The beleaguered financial institution faces new allegations that impact people
who aren't customers of the bank this time.
 * Author:
   Daniel Kline
 * Updated:
   18 hours ago
   Original:
   Aug 4, 2023




Wells Fargo admitted to having employees create millions of fake accounts for
its customers between 2002 and 2016. The company pushed its employees into doing
that by creating unrealistic sales goals, which it admitted to when it settled
with the U.S. government in 2022.

To settle the matter the bank paid a $3 billion fine.

DON'T MISS: Kroger Makes a Change Customers Hate 

“Our settlement with Wells Fargo, and the $3 billion monetary penalty imposed on
the bank, go far beyond ‘the cost of doing business,’" Andrew Murray, the U.S.
Attorney for the western district of North Carolina, had said. "They are
appropriate given the staggering size, scope, and duration of Wells Fargo’s
illicit conduct, which spanned well over a decade,” 



It was one of the biggest banking scandals of all time, and you would think that
it was something that would never happen at the bank again. 

Now, however, an NBC News investigation shows that people have been discovering
mysterious new Wells Fargo (WFC) - Get Free Report accounts that they never
actually opened.

Wells Fargo has faced a number of scandals.

Image source: Shutterstock/TheStreet







WELLS FARGO FACES NEW ALLEGATIONS  

The new NBC report alleges that a number of people have reported discovering new
Wells Fargo accounts in their name that they did not open. 

One of those people with an account in his name that he did not open, Jay
Patterson, works as a forensic accountant helping consumer lawyers investigate
big banks. 

"Other consumers, in public complaints to regulators, have detailed similarly
mysterious Wells Fargo bank accounts, raising fresh questions, experts say,
about compliance and risk management at a bank that has been rocked by scandals
in recent years," NBC reported.

The difference between these new fake accounts and the previous scandal is that
these are accounts created for people who are not Wells Fargo customers. In the
previous scandal, the company's employees were adding new accounts for existing
customers.

NBC called this "synthetic identity fraud -- when impostors create new
identities using a combination of real and fake personal information, such as
names, Social Security numbers, birth dates, and driver’s license numbers."
That's a tactic used to launder money, finance terrorism or defraud financial
institutions, government agencies, or individuals, according to the story.  






When Patterson's fake account was created, some of his personal information was
correct, but some of it wasn't. This raises questions as to whether the bank is
properly vetting new accounts.


WELLS FARGO FACES A $1.8 BILLION BILL 

Wells Fargo also said in an Aug. 1 Securities and Exchange Commission filing
that it expected to pay $1.8 billion as part of a special-assessment fee
proposed by the Federal Deposit Insurance Corp. The federal agency is looking to
recoup the $15.8 billion it spent during the March failures of Signature and
Silicon Valley Bank.

The FDIC has not finalized the payment plan, but it's expected to allow banks to
pay their share over eight quarters beginning in June 2024. 

Wells Fargo will not be alone in having to pay the FDIC.  

"Banks with total assets of more than $50 billion would pay more than 95% of a
special fee aimed at making up a $15.8 billion hit to the Federal Deposit
Insurance Corp.’s Deposit Insurance Fund in the wake of several bank failures,"
Banking Dive reported.

Banks with assets under $5 billion would be exempt from the special assessment
payments.





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