SAN FRANCISCO--(BUSINESS WIRE)--Wells Fargo & Company (NYSE:WFC) today announced the expansion of its class-action settlement for retail sales practices (announced on March 28) to include any customers who were impacted by sales practice issues as early as May 2002. The updated settlement will add $32 million to the previous agreement for a total settlement amount of $142 million.
“The expansion of this agreement is another important step to make things right for our customers,” said Tim Sloan, Wells Fargo’s President and Chief Executive Officer. “On our journey to rebuild trust, we want to ensure our customers feel confident that we have heard their concerns about retail sales practices, which includes offering them numerous opportunities for remediation. We encourage any customer with concerns or questions about their accounts to contact us.”
The settlement builds on ongoing remediation efforts Wells Fargo is pursuing for customers who may have been impacted by sales practice issues. The company is working directly with customers to resolve issues through its complaints process. In addition, if Wells Fargo is unable to resolve issues directly, customers who believe they received a product or service they did not want or authorize are offered a free mediation service with an independent third-party mediator.
Wells Fargo has submitted the class-action settlement agreement and summary of claims process in the Northern District of California (Jabbari v. Wells Fargo, N.A., et al.) to settle the lawsuit concerning retail sales practices. The updated settlement agreement takes into account findings from the Sales Practices Investigation conducted by the independent board directors of Wells Fargo (released on April 10). The settlement class now will consist of all customers who claim that Wells Fargo opened an account in their name without consent, enrolled them in a product or service without consent, or submitted an application for a product or service in their name without consent during the period from May 1, 2002, through April 20, 2017.
Wells Fargo expects this settlement to resolve claims in 11 other pending class actions that unauthorized accounts were opened in customers’ names or that customers were enrolled in products or services without their consent.
After attorneys’ fees and costs of administration, the $142 million settlement will provide three forms of compensation for settlement class members: reimbursement of fees incurred, compensation for damage to credit caused by the opening of unauthorized accounts at Wells Fargo, and after repayment of fee damages and credit impact damages, additional compensation paid from the Net Settlement Fund.
Customers who were charged fees in connection with unused, unauthorized accounts from January 1, 2009, through April 20, 2017, will be eligible to receive fee reimbursement in the amount of the actual fees they were charged as determined by the settlement administrator. If a customer was charged fees related to an unauthorized account from May 1, 2002, through December 31, 2008, he or she will receive a flat-rate fee reimbursement that will be based on the average of fees paid out to those who file claims for the Jan. 1, 2009 – April 20, 2017 period.
Remediation Efforts Continue
This settlement is in addition to other remediation efforts that Wells Fargo continues to pursue. To date, Wells Fargo has refunded approximately $3.2 million to customers under the stipulated judgment with the Los Angeles City Attorney and the CFPB and OCC consent orders, covering the period 2011 - 2016.
To make things right with customers who were impacted by sales practices issues, Wells Fargo also is conducting its own voluntary review of accounts from 2009 – 2010 to determine and remediate any customer harm.
Customers should contact Wells Fargo directly if they believe they had an unauthorized account or service opened in their name, by visiting a branch or calling 1-877-924-8697.
Next Steps
The settlement agreement must be approved by the court. If the court grants preliminary approval of the settlement agreement, a notice will be issued providing information concerning the process for making claims, and customers who believe they should be included in this suit will be able to submit claims. The court also will need to grant final approval of the settlement before payments will be made to class members. In the meantime, customers do not need to take any action; however, as always, they are encouraged to contact Wells Fargo to discuss any account issues.
About Wells Fargo
Wells Fargo & Company (NYSE: WFC) is a diversified, community-based financial services company with $2.0 trillion in assets. Founded in 1852 and headquartered in San Francisco, Wells Fargo provides banking, insurance, investments, mortgage, and consumer and commercial finance through more than 8,500 locations, 13,000 ATMs, the internet (wellsfargo.com) and mobile banking, and has offices in 42 countries and territories to support customers who conduct business in the global economy. With approximately 273,000 team members, Wells Fargo serves one in three households in the United States. Wells Fargo & Company was ranked No. 27 on Fortune’s 2016 rankings of America’s largest corporations. Wells Fargo’s vision is to satisfy our customers’ financial needs and help them succeed financially. News, insights and perspectives from Wells Fargo are also available at Wells Fargo Stories.
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