Virginia has joined a multistate settlement in which Wells Fargo Bank will pay $575 million to resolve claims that it set up fake accounts without its customers’ permission and made improper auto and mortgage loan charges.
Virginia’s share of the settlement is $11.55 million, Attorney General Mark Herring’s office announced Friday.
All 50 states are involved in the settlement, which comes two years after it was revealed that some Wells Fargo employees opened about 3.5 million unauthorized accounts in customers’ names. The employees said they did so because they feared losing their jobs if they did not meet aggressive sales quotas.
“Consumers should not have to bear the costs of services they did not want and did not sign up for,” Herring said in a statement.
“Wells Fargo must be held accountable for creating a corporate culture of unreasonable sales goals and incentives that led to employees using deceptive tactics to fill quotas for fear of losing their job,” he said.
Herring and other state attorneys general also argued that Wells Fargo essentially forced auto insurance policies on more than 2 million auto loan customers.
Wells Fargo has agreed to provide remediation of more than $385 million to about 850,000 auto finance customers, Herring’s office said. The remediation will include payments to over 51,000 customers whose cars were repossessed.
“This agreement underscores our serious commitment to making things right in regard to past issues as we work to build a better bank,” said Wells Fargo CEO Tim Sloan in a statement Friday.
Wells Fargo previously settled with federal regulators, including the Consumer Financial Protection Bureau, and agreed to provide $600 million in restitution to customers and pay $1 billion in civil penalties to the federal government.
As part of the multistate settlement, Wells Fargo will set up a website within 60 days through which consumers who believe they were affected by the bank’s conduct, but fell outside the prior restitution programs, can contact Wells Fargo to be reviewed for potential redress, Herring said.