Wells Fargo Agrees To Pay $3 Bln To Resolve Criminal And Civil Investigations

(RTTNews) - Wells Fargo & Co (WFC.N) has agreed to pay $3 billion to settle criminal and civil probes into fraudulent sales practices involving the opening of millions of accounts without customer authorization, the U.S. Attorney's Office said Friday. Wells Fargo's $3 billion payment includes a $500 million civil penalty to be distributed by the SEC to investors.

Wells Fargo will pay the penalties to the U.S. Justice Department and SEC and enter into a three-year deferred prosecution agreement to resolve a criminal investigation into false bank records and identity theft. It must abide with terms of the agreement, to avoid prosecution, including continuing to cooperate with any further government investigations, Justice Department officials said.

As part of the deal, Wells Fargo admitted that between 2002 and 2016 it pressured employees to meet unrealistic sales goals that led thousands of employees to provide millions of accounts or products to customers under false pretenses or without consent, often by creating false records or misusing customers' identities," the department said in a statement.

"This case illustrates a complete failure of leadership at multiple levels within the Bank. Simply put, Wells Fargo traded its hard-earned reputation for short-term profits, and harmed untold numbers of customers along the way," said U.S. Attorney Nick Hanna for the Central District of California.

As part of the agreements, Wells Fargo admitted that it collected millions of dollars in fees and interest to which the Company was not entitled, harmed the credit ratings of certain customers, and unlawfully misused customers' sensitive personal information, including customers' means of identification.

"We are committing all necessary resources to ensure that nothing like this happens again," Wells Fargo's chief executive, Charles W. Scharf, said in a statement on Friday.