According to an internal report prepared by the executive, it was found out that there were more than 8, 00,000 car loan borrowers who had taken a loan for the vehicle and charged with an additional amount for auto insurance without informing the customer about it. It wasn’t enough that they weren’t informed about the false addition to the amount and many of them are still unaware of this fact and paying it to the bank. This led to the delinquent status of more than 2, 74, 000 Wells Fargo customers and more than 25000 vehicles were wrongly sent for repossession. This was cleared in the 60-page report issued by the bank executive after identification of the fault. This isn’t the first time when such mistake or possibly a deliberate activity was done by the executives of the bank to earn some revenue for the bank.
Although, Wells Fargo bank is one of the largest banks in the US but has come across such situation more than once till now. Earlier, the bank was caught in a scandal where they were fined for an amount of $180 million for opening additional checking account and issuing credit cards to the currently existing customers without their consent. The bank has already lost its reputation and was trying to do the repair work by paying the imposed fine and closing all those fake accounts and returning funds to the customers. They also fired the majority of their sales staff who were the active participants in this scandal and ensured to have a transparent and clean procedure for the well being of the customer.
There are certain other allegations against the bank in relation to making improper adjustments to the amount and terms of the home loan of many customers. Although Wells Fargo bank has denied any such allegations and it has not yet been proved. The bank has taken the responsibility that the auto insurance practice happened in the bank and they would be taking necessary steps to ensure the customer doesn’t suffer due to their negligence. They also agreed to the fact that they overlooked their third party vendor and failed to monitor their operations due to which the customer is suffering. But the good part of the story is that they found about this all on their own and there was no intervention of any external person allegedly accusing the bank of it. The bank has assured that the repairing procedure to rectify this error is already started and they would ensure that the issue will be resolved soon.