Wells Fargo Fined $1.7 Billion by Consumer Financial Protection Bureau

The bank was fined for "widespread mismanagement" and "illegal activity," according to the CFPB.

The bank was fined for “widespread mismanagement” and “illegal activity,” according to the CFPB.

Today, financial regulators from the Consumer Financial Protection Bureau ordered banking company Wells Fargo to pay a $1.7 billion civil penalty on the grounds of both accidental and deliberate mismanagement of customer accounts. By the CFPB’s estimates, Wells Fargo’s actions have caused damages to around 16 million consumer accounts.

The mismanagement in question includes repeated misapplication of loan payments, illegal home foreclosures, illegal vehicle repossession, and incorrectly assessed fees and interest rates. In addition to the civil penalty, Wells Fargo will also be paying over $2 billion in compensation to those whose accounts were affected by this mismanagement.

“Wells Fargo’s rinse-repeat cycle of violating the law has harmed millions of American families,” CFPB director Rohit Chopra said in a statement.

Wells Fargo has made no objections to the CFPB’s decision, and is working to acquiesce to their demands. “We and our regulators have identified a series of unacceptable practices that we have been working systematically to change and provide customer remediation where warranted,” Wells Fargo CEO Charlie Scharf said in the statement. “This far-reaching agreement is an important milestone in our work to transform the operating practices at Wells Fargo and to put these issues behind us.”

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