Wells Fargo Acknowledges Creation Of Nearly Twice As Many Possible Fake Accounts

Aug 31, 2017
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Wells Fargo got caught up in a huge scandal last fall. It came to light that the bank had opened millions of accounts in customers' names, and the customers had never given permission. Federal regulators said that amounted to fraud. Well, today there's an alarming update. Wells Fargo says an internal review has found nearly twice as many of those unauthorized accounts as previously announced. NPR's Chris Arnold reports.

CHRIS ARNOLD, BYLINE: This scandal happened in the first place because Wells Fargo had a pressure cooker sales culture that pushed employees very hard. They had to open five or 10 or even 20 new credit card or checking accounts for customers in a single day. Former workers told NPR that the pressure to sell, sell, sell was disturbingly intense.

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ASHLEY: We were all miserable, and it was just soul-crushing to walk in every day.

ERIC: It was every day, man. I mean it was literally every day. And it was a grind house.

ARNOLD: Those were former workers we spoke to late last year named Ashley and Eric, who didn't want to use their last names. Ashley said when she didn't make her quota - or the bank called it her, quote, "solutions goal" - two managers would march her into a back room at the branch.

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ASHLEY: They shut the door, locked the door. You sit down, and they say, here's your formal warning. You have to sign this. If you don't meet your solutions, you will be fired, and it's going to be on your permanent record. And it was the feeling that no other employer is going to want you because we will ruin you.

ARNOLD: Ashley said that this pressure pushed many of her co-workers to sign up customers for accounts without their knowledge. She says she didn't do that. Wells Fargo, which we should note is a sponsor of NPR, admitted last year that there were some 2 million of these accounts. That led to a huge outcry. There were congressional hearings, multiple investigations, class-action lawsuits. And now today, Wells Fargo admits that it's found nearly double the number of improper accounts. That's because they looked back a few more years and found a lot more wrongdoing. Now the number is 3.5 million accounts.

The bank's CEO, Tim Sloan, said in a statement, quote, "we apologize to everyone who was harmed by unacceptable sales practices." Sloan's been apologizing for months now because of a string of other debacles, including the bank's improperly repossessing people's cars.

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MICHAEL FEIFER: I called the police. I was livid. I thought somebody stole my car.

ARNOLD: That was Michael Feifer, who we spoke to earlier this summer after news broke that the bank signed up about half a million customers for auto insurance. The problem was that they didn't need it and, in many cases, didn't even know about it. Tens of thousands of people wound up in default, which hurt their credit scores. And thousands had their cars repossessed.

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FEIFER: I was blown away. I wasn't alone in it, and I felt like they're preying on everybody, taking people's money. I felt like they're crooks.

ARNOLD: Wells Fargo said that this was not a case of trying to improperly profit at customers' expense. It was just an embarrassing breakdown in processes and internal controls. There is another ongoing issue facing the bank. Workers in branches across the country told NPR that they tried to blow the whistle on the bogus accounts scandal by calling the bank's ethics line. But they say the bank fired them and put a mark on their permanent record making it hard to find another job in the financial industry. Wells Fargo has said the claims are disturbing and that it's looking into the matter. An ongoing Senate inquiry is looking into it as well. Chris Arnold, NPR News. Transcript provided by NPR, Copyright NPR.