SAN FRANCISCO–Wells Fargo is now in the process of refunding customers for tens of millions of dollars for products they never ordered, ranging from pet insurance to legal services. The bank said several-thousand customer accounts are involved.
The refunds are only the latest black eye for the bank that has been tarnished by numerous scandals, including the creation of more than three-million bogus accounts as employees sought to meet aggressive cross-sales goals. That scandal alone led to more than 5,000 employees being fired.
Its current effort is focused on refunding to customers money spent on so-called add-on products for which customers were changed. Many customers did not understand or use the products, the Wall Street Journal reported.
The Journal added the Bureau for Consumer Financial Protection is looking into the matter and is focused on whether customers were deceived, their awareness of the products and their ability to cancel the products.
In mid-2017, Wells Fargo stopped selling consumer add-on products and is in the process of notifying customers, a person familiar with the matter told the Wall Street Journal. Some products are being terminated immediately, while others aren’t being renewed after they expire, the person said.
A spokesperson for the bank told the Journal, “…we will make things right with customers in the form of refunds or remediation.”
Separately, Wells Fargo reported last week it was taking a $619-million charge to refund customers it previously overcharged in its foreign-exchange, wealth-management and auto- and mortgage-lending units. Earlier this year, it also reached at $1-billion settlement with the BCFP and the OCC over its failure to manage risk.