MortgagePolitics & Money

Wells Fargo extends deadline to take part in $142 million fake account settlement

Deadline was February 3, new deadline is July 7

It’s been a busy day in the settlement department for Wells Fargo.

Early Friday, the bank was fined $1 billion by the Consumer Financial Protection Bureau and the Office of the Comptroller of the Currency for mortgage lending and auto insurance abuses.

And late Friday afternoon, the bank notified customers that it is extending the deadline to participate in the bank’s $142 million fake account class action settlement.

Originally, the deadline to take part in the settlement was Feb. 3, 2018, but the bank announced Friday that is extending the deadline to July 7, 2018.

The settlement stems from legal actions that were brought against the bank in the wake of the CFPB, OCC, and the city and county of Los Angeles fining the bank $150 million for more than 5,000 of the bank’s former employees opening as many as 2 million fake accounts in order to get sales bonuses.

The fine, which is totally separate from the $1 billion fine announced Friday, led to class action lawsuit brought on behalf of the bank’s customers who had a fake account opened in their name.

In March of last year, Wells Fargo announced that it agreed to a $110 million settlement in the lawsuit, before increasing the settlement proposal from $110 million to $142 million to cover anyone who had a fake account opened in their name stretching back to 2002.

The settlement class consists of all people who claim that Wells Fargo opened a consumer or small business checking or savings account or an unsecured credit card or line of credit without their consent from May 1, 2002 to April 20, 2017.

Also included in the settlement are customers who may have been enrolled in identity theft protection services without their knowledge or consent.

And now, Wells Fargo customers who believe they fit into that category have more time to take part in the settlement and receive compensation for the bank’s alleged actions.

“If you believe Wells Fargo opened a checking, savings, credit card, or line of credit account for you without your permission, or if you purchased identity theft protection from us, you may be entitled to compensation from this fund,” the bank said in its note to customers.

“If you submit a claim, you may be eligible for reimbursement of fees, compensation for potential impact on your credit, and an additional cash payment based on any money remaining in the fund after benefits and costs are paid out,” the bank continued.

According to the bank, customers who previously submitted a claim do not need to submit another claim. Any claims submitted after the earlier deadline of Feb. 3, 2018 will be treated as “timely,” and allowed to be part of the settlement.

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