Once again Wells Fargo got hit with another huge scandal over sales practices that have harmed hundreds of thousands of customers. This time Wells Fargo improperly charged its auto borrowers for costly auto insurance and then repossessed their cars. The New York Times reported Friday that more than 800,000 Wells Fargo customers were charged for auto insurance they did not request.
Shareholders, analysts, lawmakers and consumer advocates demanded answers about how the situation manifested, and why Wells Fargo did not disclose the problems sooner, given existing turmoil over phony deposit and credit card accounts opened in customers’ names without their permission.
“This is a full-blown scandal — again,” said New York City Comptroller Scott Stringer, who oversees public pension funds that hold roughly 11.6 million Wells Fargo shares. “It’s unbelievable, outrageous, sad, and yet quintessential Wells Fargo. This isn’t just a corporate debacle. It’s caused real human harm.”
Stringer called on the bank to install a new independent chair and “immediately” disclose more information.
U.S. Senator Elizabeth Warren also called on Federal Reserve Chair Janet Yellen to remove members of Wells Fargo’s board after revelations the company improperly charged customers for auto insurance.
In a letter sent Friday to Yellen, Warren, a Democrat, said the recent revelation of more improper charges at the bank indicates “deep risk management problems,” and called for the removal of all board members who served from 2011 to 2015, when the activity reportedly occurred.
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