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Articles Posted in Wells Fargo

The Justice Department’s criminal prosecution finally ended and resulted in Wells Fargo agreeing to pay a $3,000,000,000 (Billion) dollar fine for their fraudulent activity. 

Wells Fargo bank employees allegedly opened millions of savings and checking accounts in the name of actual customers without their consent or knowledge. According to the Justice Department, apparently, the bank employees were under significant pressure to meet high quotas and resorted to this sort of activity for over a decade.

Executive upper management was not only aware of what was going on but allegedly made attempts to hide the fake accounts from customers by forging signatures and preventing uninvolved Wells Fargo employees from contacting certain customers for surveys.

A class-action lawsuit has been filed against Wells Fargo, among several other large banks, for allegedly manipulating the Paycheck Protection Program applications for their benefit. Although CEO Charlie Scharf released statements indicating that their focus is geared towards small businesses with less than 50 employees, what actually happened seems to indicate otherwise.

Using data obtained from the U.S. Small Business Association there seems to be evidence that the bank front-loaded larger business applications before small business and once the Paycheck Protection Program grant fund dried up, the small businesses that applied were left without assistance.

By pushing larger companies forward, Wells Fargo was ensuring the collection of larger processing fees and collections in contrast to the nominal fees they might have collected from the smaller businesses. Although Wells Fargo has said that the fees they collected through processing the PPP applications will be given as charitable grants to nonprofits that support small businesses. 

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