US banking giant Wells Fargo has agreed to pay $1 billion to settle a class-action lawsuit connected to illegal practices that regulators say the bank perpetrated on the American public.
The settlement stems from a series of fraudulent business practices that Wells Fargo systematically deployed against its customers, according to the Consumer Financial Protection Bureau (CFPB).
In December, Wells Fargo agreed to pay the CFPB a record $3.7 billion fine for illegally freezing customer accounts, charging unlawful fees, opening customer accounts without permission and improperly seizing vehicles.
Today’s additional $1 billion class-action settlement will be paid to investors who bought Wells Fargo stock between February of 2018 and March of 2020.
The new settlement was reached with the help of a mediator and in a statement Wells Fargo admits no wrongdoing, reports Courtroom News Service.
“While we disagree with the allegations in this case, we are pleased to have resolved this matter.”
According to the CFPB, Wells Fargo’s practices hurt millions of American families and caused billions of dollars in financial harm.
“The bank’s illegal conduct led to billions of dollars in financial harm to its customers and, for thousands of customers, the loss of their vehicles and homes.
Consumers were illegally assessed fees and interest charges on auto and mortgage loans, had their cars wrongly repossessed, and had payments to auto and mortgage loans misapplied by the bank.
Wells Fargo also charged consumers unlawful surprise overdraft fees and applied other incorrect charges to checking and savings accounts.”
In total, the agency says the illegal conduct affected over 16 million consumer accounts and the fines were in part used to refund billions of dollars to people across the country.
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