CINCINNATI—Fifth Third Bancorp said it “rejects” the allegations made in a lawsuit filed by the Consumer Financial Protection Bureau that alleges its employees opened unauthorized accounts in the names of its customers.
Fifth Third said its own review shows issues related to fewer than 0.01% of accounts opened during the six-year period reviewed by the CFPB.
As CUToday.info reported here, the CFPB lawsuit filed in federal district court in the Northern District of Illinois alleges the $169-billion Fifth Third Bank opened deposit and credit-card accounts in consumers’ names; transferred funds from consumers’ existing accounts to new, improperly opened accounts; enrolled consumers in unauthorized online-banking services; and activated unauthorized lines of credit on consumers’ accounts, all without customers’ knowledge or consent.
That is not so, according to Fifth Third, which issued a statement calling the CFPB’s lawsuit “unnecessary and unwarranted.”
“Fifth Third’s compensation and employee incentive structure does not reward retail employees for opening unauthorized accounts, nor does it give them sales quotas or product-specific targets,” said Susan Zaunbrecher, the bank’s chief legal officer. “Our controls are designed to prevent and detect unauthorized account openings. For almost a decade, our incentive compensation system has focused on account quality. In fact, it claws back compensation from employees for accounts that are unused or closed shortly after they were opened.
Three-Year Investigation
“After an investigation spanning more than three years and involving nearly half a billion pieces of data produced by the bank, the CFPB has not informed us of any unauthorized accounts beyond the fewer than 1,100 accounts that the bank itself identified out of 10 million – or approximately 0.01% of accounts opened between 2010 and 2016,” Zaunbrecher continued. “These accounts involved less than $30,000 in improper customer charges that were ultimately waived or reimbursed to customers years ago. While even a single unauthorized account is one too many, we took appropriate and decisive action to address each situation.”
Zaunbrecher said Fifth Third is “confident” it has treated its customers fairly and that when a federal court hears the evidence it will agree.
“The bank will press for an early trial,” she added.