When cross selling is based on efforts to generate more business from existing customers based on strong customer satisfaction and excellent customer service, it is a common and accepted business practice. In recent years, the bank has sought to distinguish itself in the marketplace as a leader in “cross selling” these products and services to existing customers who did not already have them. Wells Fargo, headquartered in Sioux Falls, S.D., is one of the biggest banks in the country and offers many consumer financial products and services, including savings and checking accounts, credit cards, debit and ATM cards, and online-banking services. The full text of the CFPB’s Consent Order can be found at: Today’s action should serve notice to the entire industry that financial incentive programs, if not monitored carefully, carry serious risks that can have serious legal consequences.” “Because of the severity of these violations, Wells Fargo is paying the largest penalty the CFPB has ever imposed. “Wells Fargo employees secretly opened unauthorized accounts to hit sales targets and receive bonuses,” said CFPB Director Richard Cordray. The bank will also pay an additional $35 million penalty to the Office of the Comptroller of the Currency, and another $50 million to the City and County of Los Angeles. Wells Fargo will pay full restitution to all victims and a $100 million fine to the CFPB’s Civil Penalty Fund. According to the bank’s own analysis, employees opened more than two million deposit and credit card accounts that may not have been authorized by consumers. Spurred by sales targets and compensation incentives, employees boosted sales figures by covertly opening accounts and funding them by transferring funds from consumers’ authorized accounts without their knowledge or consent, often racking up fees or other charges. $100 million for the widespread illegal practice of secretly opening unauthorized deposit and credit card accounts. Today the Consumer Financial Protection Bureau (CFPB) fined Wells Fargo Bank, N.A.
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