Wells Fargo to pay $575M settlement over scandal involving mortgage division

The bank remains under investigation for alleged misconduct in other branches

National /
Dec.December 28, 2018 04:45 PM

Wells Fargo CEO Tim Sloan (Credit: Getty Images, iStock, and Pixabay)

Wells Fargo agreed to pay $575 million to all 50 states and the District of Columbia over misconduct that harmed customers, the latest in a string of payouts for the country’s third-largest bank.

The payments are meant to cover improper charges to auto loan and mortgage customers, along with the fake accounts scandal that rocked the bank two years ago, according to the Wall Street Journal.

States have alleged that Wells Fargo improperly charged residential borrowers on mortgages. Specifically, states accused the bank of charging customers rate-lock extension fees — even when the the bank itself was what delayed customers from closing beyond the rate-lock period, according to the office of New Jersey Attorney General Gurbir S. Grewal. Wells Fargo is now refunding mortgage customers around $100 million over the accusations.

The agreement follows investigations into Wells Fargo’s sales and consumer-lending practices dating as far back as 2002. And since September 2016 the bank has paid $4 billion in settlements and fines. Earlier this year the bank paid the federal government $2.1 billion over its role in the financial crisis. In November, the bank disclosed that a software error contributed to the foreclosure of hundreds of customers’ homes.

The latest settlement is still subject to court approval in some states, but the biggest payout — about $150 million — will go to California because of the number of customers there. Meanwhile, the federal government continues to probe alleged misconduct in Wells Fargo’s wealth-management and foreign-exchange business. [WSJ] – Dennis Lynch 


Related Articles

arrow_forward_ios
With a cooling trade war, stocks perform well, including real estate. (Credit: iStock)

Real estate stocks push up this week as U.S.-China trade tensions ease

Real estate stocks push up this week as U.S.-China trade tensions ease
416 West 25th Street and Maverick Real Estate Partners principal David Aviram (Credit: Google Maps and LinkedIn)

Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case

Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case
Tommy Hilfiger and his recently sold estate in Greenwich, CT. (Getty, Janet Milligan)

Tommy Hilfiger’s Greenwich estate sells for $45M

Tommy Hilfiger’s Greenwich estate sells for $45M
Jenna Ryan was part of a group who flew on a private plane from Denton, TX, to Washington, D.C., with the intention of joining the protestors (Twitter.com/DotJenna)

Texas Realtor faces criminal charges for role in Capitol attack

Texas Realtor faces criminal charges for role in Capitol attack
Cindat Capital Management CEO Greg Peng and Hersha Hospitality Trust CEO Jay Shah with 51 Nassau Street (Google Maps)

7 Manhattan hotels head to auction block

7 Manhattan hotels head to auction block
Porch CEO Matt Ehrlichman (iStock)

Porch snaps up four startups for over $122M

Porch snaps up four startups for over $122M
Nir Meir Asks Court to Stop Eviction (Google Maps)

Nir Meir seeks to throw out Hamptons ejection suit

Nir Meir seeks to throw out Hamptons ejection suit
Robert Frank with 1021 Park Avenue and Ben Lambert with 28 Laight Street (Getty, Google Maps)

Who’s buying and selling Manhattan homes? Last month’s notable deals

Who’s buying and selling Manhattan homes? Last month’s notable deals
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...