Wells Fargo faces proposed class action over bogus accounts

EghtesadOnline: Wells Fargo & Co, embroiled in a scandal over the opening of sham accounts, was sued on Friday by customers who accused the bank of fraud and recklessness for its behavior.

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17 September 2016

The lawsuit was filed in the U.S. District Court in Utah, and seeks class-action status on behalf of hundreds of thousands of customers nationwide, according to Reuters.

Wells Fargo did not immediately respond to requests for comment.

Last week, the San Francisco-based lender agreed to pay $190 million to settle regulatory charges that employees opened some 2 million accounts without customers' knowledge, in order to meet sales targets.

Wells Fargo, the country's third-largest bank by assets, has said it has fired 5,300 people over the matter and would eliminate sales goals in its retail banking on Jan. 1, 2017.

Federal prosecutors have begun examining Wells Fargo's practices, and the bank's Chief Executive Officer John Stumpf is scheduled to testify before Congress next week.

In the complaint, three plaintiffs said customers were hurt by "abusive and fraudulent tactics" used by employees who felt they had to "do whatever it takes," including selling products they did not need or want, to meet sales quotas.

It was not immediately clear how the three named plaintiffs were specifically harmed by the bank's alleged wrongdoing.